Oklahoma Gov. Mary Fallin said Wednesday that she plans to propose an income-tax cut during the upcoming legislative session.
“You will see me propose a tax cut,” Fallin said during a brief, impromptu interview with Capitol reporters.
Fallin said she plans to outline the proposed income-tax cut during her Feb. 3 State of the State speech that will open the 2014 session of the Oklahoma Legislature.
She declined to say how large the proposed cut would be or to provide other details.
“We're still working on that proposal,” she said.
Oklahoma requires the governor to present a balanced budget to the Legislature and the state is projecting a $171 million reduction in the amount it will have available for appropriation from its general fund for next fiscal year.
The governor declined to say whether she will propose any revenue enhancing measures or whether the tax cut would have to be funded by decreased appropriations elsewhere.
She also declined to say how soon she would propose that the tax cut take effect or whether there would be a triggering device that would require a certain amount of revenue growth before the cut would be implemented.
Historically, Oklahoma tax cuts have been followed by business growth and enhanced state revenue growth, she said.
The Legislature approved a tax cut measure last year, but it was overturned by the Oklahoma Supreme Court because it covered more than one topic in a single bill. The rejected measure called for reducing Oklahoma's top income tax rate from 5.25 percent to 5 percent on Jan. 1, 2015. It also set up a mechanism that would have cut the top income tax rate to 4.85 percent in 2016 if total revenue growth in fiscal year 2016, which begins July 1, 2015, equaled or exceeded the fiscal impact of the 0.15 percentage point cut.
A group of Republican lawmakers recently introduced House and Senate bills that would gradually cut Oklahoma's top income tax rate from 5.25 percent to 4 percent within four years. The governor did not indicate whether her proposal would be similar.