Latest news with #HouseBill2764
Yahoo
29-05-2025
- Business
- Yahoo
Oklahoma governor signs income tax cut deal: What to know
Republican Gov. Kevin Stitt has signed an income tax cut into law, accomplishing his main goal of the legislative session with days to spare. The quarter-point cut will reduce Oklahoma's income tax rate to 4.5% for most earners, while costing the state between $160 million and $300 million a year in lost revenue, according to varying estimates. Stitt has long pressed for reducing income taxes and reached a deal this year with the Republican-led Legislature to make it happen. The agreement includes a consolidation of income tax brackets and what Stitt has described as a "path to zero" income tax, with triggers meant to further reduce the tax rate in future years. While Stitt had opened the Legislative session in February by calling for a steeper half-point tax cut, he has still seemed pleased with landing a quarter-point cut. Talking about the tax cut deal during a news conference on Wednesday, May 28, Stitt said it would "automatically trigger tax cuts, not in an irresponsible way, but with excess revenue, we'll be able to trigger tax cuts and put us on a path to zero." The specifics of the cut are spelled out in House Bill 2764, which Stitt signed on Wednesday. By law, the Legislature has until Friday to finish its regular session business. Critics have questioned whether lawmakers should reduce tax collections — and also dip into savings to cover some line items in the state's nearly $12.6 billion budget for the next fiscal year — at a time of economic uncertainty. More: Gov. Stitt, legislative leaders announce budget deal including tax cuts, tort reforms According to an analysis by the Oklahoma Policy Institute, a nonpartisan Tulsa-based think tank, cutting income taxes by a quarter of a percentage point would reduce state revenues by $306 million annually. The group's analysis also showed many Oklahomans stand to save only marginal amount on their annual income tax bill. A quarter-point cut could save people who make $79,700 or less between $9 and $95, and would save those in the top 1% of incomes — making $683,500 or more — $2,936 annually, the group found. Stitt has said the cut will help out struggling families and cost the state about $160 million in lost revenue during the next fiscal year, citing Oklahoma Tax Commission numbers. Stitt has maintained because that money is spent by taxpayers, not state government, it's better for the economy. The tax cut bill passed by margins of 74-19 in the House and 34-11 in the Senate, largely along party lines. This article originally appeared on Oklahoman: Oklahoma Gov. Stitt signs income tax cut bill: What you should know
Yahoo
28-05-2025
- Business
- Yahoo
Governor signs income tax cut bill as Oklahoma lawmakers prepare to end session
Gov. Kevin Stitt speaks at his weekly media availability on May 28, 2025. (Photo by Janelle Stecklein/Oklahoma Voice) OKLAHOMA CITY – Gov. Kevin Stitt on Wednesday signed a bill to cut the state's top income tax rate. 'Over my seven years, we've cut a billion dollars in taxes for hard working Oklahomans and our economy is booming,' Stitt said. 'We still have record savings and so everything is good.' House Bill 2764 reduces the state's top income tax bracket by .25% from 4.75% from 4.5% and contains a path toward eliminating it entirely. Most Oklahomans fall within the top bracket. The fiscal impact is expected to be about $350 million. The measure also collapses the state's six tax brackets into three, and contains a mechanism for additional reductions if certain financial conditions are met. The tax cut was a key agenda item for Stitt. It comes at a time when there is new leadership in the House and Senate. Last session, the Senate refused to cut the income tax rate further. Critics of the tax cut say it comes at a time when federal COVID relief dollars have propped up the state's budget. They also said it is unwise to reduce the income tax rate when Congress is considering shifting costs for Medicaid and food stamps to the states. Last year, lawmakers and Stitt eliminated the state's 4.5% sales tax on groceries. Lawmakers could end the session on Thursday, a day earlier than they're required by law. 'I think everything is going well,' Stitt said. 'We're going to land this plane. I feel really, really good. I think it's one of the best sessions we've had in my seven years.' SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
20-05-2025
- Business
- Yahoo
Oklahoma income tax cut bill clears first hurdle, sets stage for future reductions
House Speaker Kyle Hilbert, R-Bristow, speaks at an announcement of a budget deal for the 2026 fiscal year on May 14, 2025. House budget chair Rep. Trey Caldwell, R-Faxon, stands to his right. (Photo by Emma Murphy/Oklahoma Voice) OKLAHOMA CITY – The Oklahoma House on Tuesday advanced a measure to lower the state's income tax despite concerns it would have little impact on residents. House Bill 2764 creates a process for ultimately eliminating the state's income tax when revenues hit certain triggers. The measure would initially reduce the state's top income tax to 4.5% from 4.75%. It would also collapse the six income tax brackets into three. Rep. Mark Lepak, R-Claremore, said the measure has safeguards to compensate for economic downturns. A tax cut would not occur if a revenue failure is declared, he said. It would take nearly 20 years before the income tax could be eliminated, Lepak said. Tax collections for the past 20 years on average grew at 4%, even when taxes were reduced, he said. A 0.25% cut would cost state coffers about $340 million, Lepak said. 'While it will have a small amount of savings for those in poverty, it is not sufficient enough to really have an impact on their circumstances,' said Rep. Michelle McCane, D-Tulsa. Rep. Ellen Pogemiller, D-Oklahoma City, questioned the timing of the cuts. Proposed federal changes to Medicaid could cost the state $841 million, she said. Congress is considering proposals that could require states to pick up more of the cost. Cutting taxes is an effort to check a 'political box' when there has been no substantial evidence that people want it, Pogemiller said. 'I think people would rather have daycare,' she said. 'I think people would rather have health care. I think people would rather have good roads.' Cutting the income tax by 0.25% equates to a Starbucks coffee a month for his constituents, said Rep. Andy Fugate, D-Oklahoma City. 'Maybe if you add it up over a year, it'll let them buy a couple dozen eggs,' Fugate said. The state expects to have $3.5 billion in surplus, said House Speaker Kyle Hilbert, R-Bristow. 'You reach a point as a state where you have so much surplus, you start to ask is it time we restore some of that back to the taxpayers to let them keep a little bit more of their hard earned money,' Hilbert said. He said the bill was responsible. It sets up a mechanism where an additional tax cut is only triggered if revenue projections are met plus more than what the tax cut would cost in terms of lost revenue to the state, Hilbert said. Even if the triggers are met, the Legislature could still put a tax cut on hold, Hilbert said. The measure passed by a vote of 74-19 and heads to the Senate for consideration. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX SUPPORT: YOU MAKE OUR WORK POSSIBLE
