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Reforming Oklahoma tax code may take longer than many want

by The Oklahoman Editorial Board Published: April 6, 2012
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/articleid/3663810/1/pictures/1688953">Photo - Oklahoma Gov. Mary Fallin speaks to the media during a legislative forum at the Oklahoma State Capitol, Thursday, Feb. 2, 2012 in Oklahoma City. Gov. Mary Fallin says her plan to reduce Oklahoma's income tax will reduce the number of tax brackets from seven to three and will include revenue growth criteria that will trigger future tax cuts. (AP Photo/Alonzo Adams)
Oklahoma Gov. Mary Fallin speaks to the media during a legislative forum at the Oklahoma State Capitol, Thursday, Feb. 2, 2012 in Oklahoma City. Gov. Mary Fallin says her plan to reduce Oklahoma's income tax will reduce the number of tax brackets from seven to three and will include revenue growth criteria that will trigger future tax cuts. (AP Photo/Alonzo Adams)

Incentives should primarily be structured to moti-vate behavior such as jobs creation and investment. Cutting incentives should be motivated by assessing how effective they are rather than the need to find money for tax cuts.

Somewhere in this mix of cutting taxes and cutting incentives is a balance that preserves funding for essential services, removes ineffective and/or politically motivated incentives and stimulates growth.

Fallin hopes to stimulate growth with a better tax climate, but she and other tax cutters have encountered fierce resistance from everyday Oklahomans as well as from tax consumers such as public school systems. Larkin Warner, one of the two economists issuing the state revenue/taxation report this week, says he respects tax cutters and tax cut resisters but “the one group I have trouble with is what I call the ‘starve-the-beast' caucus ... You can't run a government that way.”

Indeed you can't. What Republicans are discovering is that platitudes won't pay the bills and the people don't always embrace tax cuts if they can't see the benefits. A lower tax rate would help Fallin recruit new businesses, a primary function of the governor's office, but the folks who already live here must be convinced that it's good for them as well.

Reforming the tax code may take longer than we thought. That's not a bad thing.

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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