Gov. Mary Fallin said Thursday she will unveil plans next week to simplify the state's tax code and cut personal income tax for most Oklahomans.
The governor said her proposal, which she has been working on for five months, would not require an increase in other taxes. She hopes to make up for the lost revenue mostly by closing loopholes in the tax code, eliminating various tax credits and making state government more efficient.
“I believe this will be one of the boldest tax reform plans we've seen in our state's history. It will give us one of the lowest income tax rates in our nation. It will be a significant tax reduction for a majority of all Oklahomans, and I think it will be a game-changing moment for our state,” she said.
The plan would provide tax relief for the 2013 tax year and calls for the gradual reduction of the personal income tax through economic growth triggers, she said. If legislators approve the plan, it would take effect Jan. 1.
“Our goal is to make our tax system simpler, flatter and fairer and to give the majority of all Oklahomans a tax break,” she said. “I do not want to hurt the poor. I understand there are Oklahomans that are struggling, and we have addressed that in our tax plan.”
She said it calls for reducing the number of brackets in the personal income tax code from seven to three and an across-the-board tax cut in each bracket. The income brackets range from individuals making up to $1,000 to individuals earning $8,700 and over. The rates range from one half of 1 percent of taxable income to 5.25 percent.
Other states have brackets for those earning as much as $250,000 to $1 million.
The governor said a majority of Oklahomans in each of those three brackets would receive a tax cut.
“My goal is to protect the poor, also to help the middle class,” she said. “The majority of Oklahomans will receive a tax cut, but we still have to provide for core essential services, and I am not proposing that we starve state government or that we don't fund our core services of our state.”
Fallin told reporters during a legislative forum sponsored by The Associated Press that she would release details of her plan during her State of the State address on Monday to open this year's legislative session. She also will release her executive budget Monday.