Sen. Mike Mazzei, R-Tulsa, keeps pushing for a reversal of a decrease in the state income tax rate. Last week, the Senate Finance Committee approved a bill that would delay the reduction from 5.25 percent to 5 percent.
“Since 2004, when I first came to the Senate, we’ve reduced taxes by about $1.5 billion, thanks to a 25 percent drop in the top income tax rate, the elimination of estate taxes, the increase in the standard deduction, higher exemptions for retirement income, fewer companies subjected to the franchise tax, and the 100 percent exemption for military,” Mazzei said. “The fact is the benchmark of $6.9 billion to lower the income tax rate from 5.25 to 5 percent was never actually achieved, because the trigger was based on the December certification, not the final certification in February the Legislature must use for writing the budget. The General Revenue Fund is now more than $1 billion below the benchmark. Furthermore, you can’t continually decrease taxes and also increase special interest tax breaks – these have ballooned to $2 billion, making the current financial situation much worse. It is unwise to lower the income tax rate in this environment.
“We are facing a shortfall of $1.3 billion. If we don’t delay this reduction and adopt other reforms, education funding, which makes up some 50 percent of the budget, will have to be cut by approximately $400 million. Other core services will also be slashed. Ultimately everyone in the state will be negatively impacted.”