Senate Finance Committee Chairman Mike Mazzei, R-Tulsa, wants to suspend a cut in state income taxes and have state taxpayers pay more in 2016.
Because of a budget shortfall due to low energy prices, Mazzei filed Senate Bill 1073, which would void the scheduled income tax reduction that is dropping the rate from 5.25 percent to 5 percent this year. Mazzei thinks the State Equalization Board should not have approved the cut because it was designed to go away if state revenues dropped.
SB 1073 makes it harder to ever get another income tax cut with more stringent requirements.
The Equalization Board certified a revenue increase for fiscal year 2016 but later revised its figures to show a drop.
In December, the board projected a $900 million budget shortfall for the 2016-2017 fiscal year and that could be revised to be over $1 billion.
The .25-percent drop in income tax will cost the state less than $150 million in a discretionary budget of more than $7 billion.
Mazzei is term limited and cannot run for re-election in 2016. The 2016 legislative session begins Feb. 1.
Meanwhile, some national organizations are making grim predictions about the oil and gas industry.
One prediction has U.S. crude production falling to 8.1 million barrels per day in December. In December of 2015, production was 9.2 million barrels per day. In April of last year, the production was 9.6 barrels.
And the number of rig counts has dropped to 695 in January. That’s the lowest level since 2006. Another 400 or so are expected to go in the next six months. The expectation is that about 80 percent of the rigs active in 2014 will be closed by July of 2016.
Mild temperatures and increased output from OPEC is causing prices to fall. Thanks to a deal by President Obama with Iran, that country will immediately add 500,000 barrels of oil a day to the international market.