TAX REFORMS

 

The Legislature enacted a host of reforms designed to spur economic development by helping new and existing businesses:

  • SB 574, the Small Employer Quality Jobs Incentives Act, extends the state's landmark job creation act to smaller employers. The new program offers cash incentives to certain businesses with fewer than 90 employees if they create quality jobs. Under existing law, only large employers qualify for incentive payments.

  • SB 237 allows businesses the option of filing their franchise tax returns at the same time corporate income tax returns are due, simplifying the tax filing process.

  • SB 344 changes the income tax formula to lessen the tax burden for new corporations which invest at least $200 million. The tax will be based more on sales and less on property and payroll.

  • SB 344 expands the five-year ad valorem exemption to benefit more manufacturing facilities. Under old law, facilities had to create at least 15 new jobs to qualify. Now, the exemption will also apply to new corporations who invest at least $200 million and maintain employment of at least 500 FTE.

  • HB 1253 creates the Small Business Capital Formation Incentive Act. Effective 1998, it provides an income tax credit of 20% of amounts invested in certain small business capital companies or ventures. Qualified companies must have capitalization of at least $1 million.

  • HB 1807 exempts sales taxes on machinery and supplies used in coal mining (effective July 1, 1998).

HJR 1024 creates a 30-member Citizens' Task Force on Taxation to review the state's tax system. The Governor, Pro Tempore and Speaker each appoint ten members. The Task Force will submit a report by December 1, 1998.

The Legislature passed a number of laws to benefit non-profit organizations and charities:

  • SB 344 exempts from sales taxes certain non-profit organizations supported or sponsored by churches.

  • SB 459 amends the 1992 Oklahoma Charity Games Act to reform bingo tax procedures. It lowers the tax rate on bingo faces from 1.5¢ to 1.0¢ (effective July 1, 1998); gives organizations more time to remit taxes; requires licensing of paid employees; prohibits licensure of persons convicted of certain crimes; allows tax-exempt educational organizations to conduct games; and allows organizations to conduct two sessions per day.

  • HB 1807 exempts admission tickets to accredited museums from sales taxes, if the savings are used by the museum for debt service.

  • HB 1807 exempts from sales taxes certain biomedical research foundations and community blood banks (effective July 1, 1998).

 

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