A legislator who cites lawmakers' failure to eliminate or reduce business tax credits as a key reason the state's personal income tax wasn't reduced last year is proposing the incentives undergo a thorough review in the next two years.
“It is very clear that any effort to reduce state income taxes for all Oklahomans has run aground on the tax credit issue,” Rep. David Dank said. “We cannot give real tax relief to all while we continue to pass out hundreds of millions of dollars in questionable tax credits to a favored few.”
Dank, R-Oklahoma City, has filed legislation to establish criteria in the next two years that would govern all existing and future tax credits, with a firm sunset date of July 1, 2014, beyond which all tax credits would be changed, reauthorized or eliminated.
“My plan would take a deliberate look at every tax credit and put in place a permanent set of rules that would assure that any tax credit, now or in the future, would have to return real dollars to the state,” he said in a statement Friday.
Dank, who has been crusading to provide more accountability for tax credits and business incentives for seven years, has said that the best way to attract jobs to Oklahoma is to reduce and eventually eliminate the state's personal income tax instead of providing tax credits to certain industries and companies.
Dank said his approach would allow legislators elected last year to have two full sessions to deal with the issue.
House Bill 1369 would put in place a set of criteria that would govern existing or future tax credits. Criteria include stringent auditing; rigorous cost-benefit analysis; cost and time caps; and a requirement that any tax credit would create or sustain quality, permanent jobs. Dank said a primary goal will be ending the use of transferable tax credits that can be bought and sold.