Point-counterpoint: Ending personal income tax

David Blatt, director of the Oklahoma Policy Institute, and Michael Carnuccio, president of the Oklahoma Council of Public Affairs, debate ending state personal income tax.
Oklahoman Modified: December 4, 2011 at 1:24 am •  Published: December 4, 2011
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David Blatt

Director of Oklahoma Policy Institute, a nonprofit policy think-tank committed to adequate, fair and fiscally responsible funding of public services.

Q. Should the state's personal income tax be eliminated?

A. No.

Q. What would happen if the state's personal income tax was eliminated?

A. Oklahoma would have to drastically increase the sales tax, property tax, or both. Oklahoma already has the fifth highest sales tax rate in the nation, and raising the sales tax even further would hurt hard-pressed consumers and local retailers. And no one seriously imagines that we will try to raise property taxes.

Q. Will eliminating the personal income tax help bring jobs to the state?

A. Real-life examples and the most rigorous studies show tax differences between states are not a significant factor in attracting business. Far more important to economic development is access to skilled labor, nearby markets, public safety, and transportation infrastructure — most of which require public investments made possible by the income tax. Oklahoma's economy is already doing better than most states that lack an income tax, including Texas.

Q. Will eliminating the personal income tax adversely affect state services?

A. Three years of repeated budget cuts have already inflicted real harm on our schools, law enforcement, safety net system, and public health. Going forward, we face rising health care costs, a crumbling infrastructure, and the need for a better educated and trained workforce. We cannot meet these basic obligations and ensure that we are an educated, healthy and prosperous state if we do away with or further reduce our largest tax source.

Q. Would the average Oklahoman fare better with or without the personal income tax?

A. When you take into account the need to increase other taxes and cut services that Oklahoma citizens and businesses depend on, the average Oklahoman would fare much worse without the personal income tax. Shifting to a greater reliance on sales or property taxes would also disproportionately benefit the already wealthy while pushing more of the responsibility for funding public services onto average Oklahomans.



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