Finding offsets must be part of efforts to reduce Oklahoma income tax

by The Oklahoman Editorial Board Published: November 13, 2012

Last year, Fallin and other Republicans, with the support of conservative special-interest groups, pushed an income tax reduction without revenue-side offsets. The argument was that a growing economy, bolstered by the appeal of a low income tax state, would offset the loss of revenue. Also, consumers would use higher net pay to make purchases that would be subject to the sales tax.

The economic growth argument got help from the latest fiscal report from state Treasurer Ken Miller. He said gross state revenue jumped 9 percent in October and posted the highest percentage increase in eight months. Miller was among the moderate voices in the tax cut debate last year, urging caution.

A key thing to remember as tax cut fever registers on the thermometer in coming months is that there was no groundswell for an income tax cut last year. Furthermore, the blowback to specific tax cut proposals was significant. Average citizens joined special-interest groups and lobbyists in protesting the proposed loss of credits and deductions to help pay for income tax reduction or elimination. Finally, a significant income tax cut in Kansas — widely cited by tax cutters in Oklahoma as an imperative for cutting taxes here — has left that state with fiscal challenges that will be hard to overcome.

If Oklahoma officials are serious about cutting the income tax, they must be equally serious about finding offsets. Citizens are in no mood for a tax cut based solely on hoped-for economic scenarios.

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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