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Empty gesture: Tax cut bills not likely to pass

by The Oklahoman Editorial Board Modified: February 10, 2009 at 4:12 am •  Published: February 10, 2009
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photo - Winnie and George Hall shop for  groceries in Edmond, Okla., Thursday, Jan. 29, 2009.  Oklahoma's  grocery  tax credit would be expanded under a proposal to be considered by the state Legislature. (AP Photo)
Winnie and George Hall shop for groceries in Edmond, Okla., Thursday, Jan. 29, 2009. Oklahoma's grocery tax credit would be expanded under a proposal to be considered by the state Legislature. (AP Photo)
Seems an awkward time to cut taxes in Oklahoma, but some folks think it’s never a good time.

Measures that would phase out the state’s share of the grocery sales tax and remove the trigger for an income tax cut have advanced in the Legislature. Few believe they’ll reach the finish line.

A Senate bill seeks to end the state’s 4.5 percent sales tax on food while allowing local governments to continue taxing groceries. This would be done in phases; by 2013, no state sales tax would be assessed on food.

Another bill would take the lock off the trigger that must be reached to fire off another income tax cut. The trigger was put in place to restrict a drop in the maximum tax rate of 5.5 percent. The stepdown, which requires favorable economic conditions in order to be triggered, would be to 5.25 percent.

That would still be 5.25 percentage points above the income tax in Texas, which also exempts groceries from its sales tax. But Texas has other taxes that exceed Oklahoma’s.

A Senate committee has advanced tax cut bills, but the likelihood that any will survive is remote. The state faces a potential $600 million shortfall; that number could grow.

We’re not sure it’s a good idea to cut the state grocery tax without a phase-out of the local food sales taxes. This would require a new way to finance local governments.

As for the income tax stepdown, it must await better days.

by The Oklahoman Editorial Board
The Oklahoman Editorial Board consists of Gary Pierson, President and CEO of The Oklahoma Publishing Company; Christopher P. Reen, president and publisher of The Oklahoman; Kelly Dyer Fry, editor and vice president of news; Christy Gaylord...
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