Fallin’s agenda contains at 164 new sales tax increases

Gov. Mary Fallin, who ran on a platform of no new taxes, proposed huge tax increases in her state-of-the-state address February 6 at the State Capitol.

Fallin wants to hike taxes on cigarettes and gasoline and begin taxing a host of services that now are not taxed. She is proposing new taxation on 164 specific services, including funerals, haircuts, child care, cable TV, legal fees, doctor visits and much more.

Fallin sees tax increases as a way to make up for a budget shortfall projected at almost $900,000,000. Her tax increases will be hard to pass in the Republican-controlled House and Senate.

State Rep. Kevin Calvey stressed that no tax increases are necessary in order to balance the state’s budget.

“There are millions of dollars in waste, unnecessary expense, and fat in state government,” said Calvey, R-Oklahoma City.  “It is wrong to take more money away from taxpayers so politicians can avoid making government work more efficiently.”

He said higher education is such an area.

“Oklahoma spends a much higher percentage of its higher education budget on non-teaching positions than other states,” said Calvey.

He estimated this excessive administration in state colleges and universities costs the state about $328 million, based on data from an Oklahoma-based government watchdog group.

“And there are many college professors on the payroll who teach few classes, if any,” Calvey said. “If all professors taught a full load, that would save the state an additional $181 million.”

In common education, he pointed to the over 500 school superintendents as an area where costs could be saved through consolidation. State reporting to the U.S. Department of Education shows that the majority of public school employees are not teachers.  Reducing non-teacher positions would save the state another $255 million, at least.

“If any business ran as inefficiently as our schools, with over half its employees being non-producers, that business would go bankrupt within a year,” said Calvey.  “The taxpayers just voted down tax increases for education because they perceive that our schools are not run efficiently. Why should legislators now vote for tax increases after the voters rejected tax increases?”

The state could save an additional $200 million to $300 million by cutting subsidies to wind industries, he said.  Critics of the wind subsidies have long argued that most of Oklahoma’s subsidies to wind companies go to out-of-state companies, and over 30 percent go to companies in foreign countries, and the subsidies create very few jobs given the huge cost to taxpayers.

“Just making these changes alone could solve the state’s budget problems without raising taxes,” Calvey said.  “And we’d have some left over to get started on raising teacher pay.”

He said he would consider revenue-neutral tax reform that would provide tax relief to Oklahoma’s families, but not tax increases.

“The government should operate the same as Oklahoma families are forced to in lean economic times,” Calvey said. “Families don’t have the luxury of wasting money instead of streamlining their spending habits.  Government should have to tighten its belt without squeezing more money from already overburdened taxpayers.  I call upon Governor Fallin to return to her roots and choose a conservative solution to budget problems instead of liberal tax increases.”

Fallin again asked legislators to raise the cigarette tax.

”To improve the health of our state, I’m also once again asking you to raise our cigarette tax,” she said. “ Smoking remains the Number One preventable cause of death in Oklahoma. It costs our state $1.62 billion in health care costs. The revenue raised can be spent on current health care needs.”

Fallin wants to raise the taxes on gasoline and diesel fuel to match tax rates in nearby states.

“Oklahoma currently ranks 48th in diesel tax in the nation and 49th in gasoline tax,” Fallin said. “ I am proposing a new revenue stream by increasing our gas and diesel taxes to the regional state average, but still below the national average.”

Fallin wants pay raises for teachers and more money for prisons. Without changes, Oklahoma must build or lease three new prisons.

“My budget includes new money for corrections and treatment, which includes a $50 million bond issue to build wings on a men’s and a women’s prison for substance abuse offenders and rehabilitation,” Fallin said.

Fallin did propose elimination of the state sales tax on groceries. She said she would compensate for the loss of funding by adding sales tax to other items not now taxed.

“This plan eliminates the most regressive tax on the books today, the state sales tax on groceries,” Fallin said. “This will benefit all Oklahomans. Eliminating the state sales tax on groceries is expected to result in annual savings of between $350 to $676 for a family of four.”

She also wants to eliminate the state’s corporate income tax.

“It will reduce the paperwork and red tape burden of many small businesses in our state and boost economic development,” Fallin said in her speech. “Eliminating this tax provides more transparency as it also eliminates the need for the Legislature to pick winners and losers with specific tax credits.”

The Democrat Party of Oklahoma criticized Fallin’s proposals.

“The Oklahoma Democratic Party is dismayed that it took a billion-dollar revenue failure for Governor Fallin to recognize that we have a revenue problem, not a spending problem,” according to a Democrat press release. “Today she admitted that we need new revenue streams so that we can fund services, education, health care and public safety.”

Fallin Proposed Tax Increases

  • Oil field services
  • Masonry contractors
  • Glass, glazing contractors
  • Roofing, siding contractors
  • Electrical contractors
  • Plumbing contractors
  • Heat/air contractors
  • Drywall contractors
  • Painting contractors
  • Flooring contractors
  • Tile contractors
  • Carpentry contractors
  • All trade contractors
  • Repair of taxable goods
  • Maintenance of taxable goods
  • Delivery of taxable goods
  • Water/sewer/refuse
  • Information services
  • Data processing
  • Custom software programs
  • Digital goods
  • Car washes
  • Car towing
  • Roadside assistance
  • Car repair
  • Undercoating
  • Cable TV
  • Trailer park overnight
  • Automobile leasing
  • Pet grooming
  • Carpet cleaning
  • Termite extermination
  • Aircraft rental (to pilots)
  • Pool cleaning
  • Diaper services
  • Fur storage
  • Landscaping
  • Marina service
  • Telephone answering services
  • Engineering services
  • Architectural services
  • Accounting
  • Auditing
  • Bookkeeping
  • Management services
  • Business consulting
  • Legal services
  • Security services
  • Window cleaning
  • Residential utilities
  • Dry cleaning
  • Land surveying
  • Funeral services
  • Gift wrapping
  • Armored car service
  • Janitorial services
  • Tire repairs
  • Taxidermy
  • Welding labor
  • Sign construction
  • Veterinary services
  • Lawn and garden services
  • Local trucking
  • Courier services
  • Warehousing and storage
  • Travel agencies
  • Tour operators
  • Freight transportation
  • Passenger transportation
  • Packing and crating
  • Inspection facilities
  • Sanitary services
  • Irrigation systems
  • Federal reserve banks
  • National commercial banks
  • State commercial banks
  • Federal savings institutions
  • Federal credit unions
  • Foreign banks
  • Nondeposit trust facilities
  • Personal credit institutions
  • Business credit
  • Mortgage bankers
  • Loan brokers
  • Security brokers
  • Commodity brokers
  • Investment advice
  • Life insurance
  • Health insurance
  • Casualty insurance
  • Surety insurance
  • Title insurance
  • Pension funds
  • Insurance agents
  • Insurance brokers
  • Insurance services
  • Nonresidential building operators
  • Apartment building operators
  • Mobile home site operators
  • Real property lessors
  • Real estate agents
  • Title abstract offices
  • Developers
  • Cemetery developers
  • Bank holding companies
  • Holding companies
  • Educational trusts
  • Religious trusts
  • Oil royalty traders
  • Patent owners
  • Investors
  • Barber shops
  • Tax return preparers
  • Miscellaneous personal services
  • Radio, TV representatives
  • Publisher representatives
  • Collection services
  • Credit reporting services
  • Commercial art design
  • Secretarial services
  • Court reporting
  • Employment services
  • News syndicates
  • Movie production
  • Dance studios
  • Theatrical producers
  • Entertainers
  • Medical doctors
  • Dentists
  • Osteopaths
  • Chiropractors
  • Optometrists
  • Podiatrists
  • Nursing care facilities
  • General hospitals
  • Surgical hospitals
  • Medical laboratories
  • Dental laboratories
  • Home health care services
  • Kidney dialysis centers
  • Outpatient facilities
  • Job training services
  • Child care services
  • Residential care
  • Social services
  • Research organizations
  • Testing laboratories
  • Tattoo services