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Oklahoma
State Senate
Communications Division
State Capitol
Oklahoma City, Oklahoma 73105
For Immediate Release: January 19, 2012
Senators introduce 'Laffer Plan' to phase out income tax
Four first-term Senators have jointly filed a bill to implement
the plan proposed by legendary economist Dr. Arthur Laffer to phase
out the Oklahoma income tax.
SB 1587 is authored by Senators David
Holt, R-Oklahoma City, Greg
Treat R-Oklahoma City, Rob
Johnson, R-Oklahoma City, and Josh
Brecheen, R-Coalgate. It would lower the Oklahoma income tax
rate from 5.25 percent to 2.25 percent in 2013, and then gradually
lower it until the rate is zero in 2022.
"We hope that by introducing the Laffer Plan, we're ensuring
that its ultimate goals remain part of the debate, not just this
year, but beyond," Holt said. "All four of us recognize
that this bill is just the beginning of a conversation, and it's
not presented as a final product. We are committed to making sure
Oklahoma's government delivers on its core missions, but we also
cannot ignore the economic growth happening in states without income
tax."
The first reduction in the income tax rate is paid for by cuts in
nonessential spending, along with the elimination of most personal
tax credits, exemptions, deductions and exclusions. Further reductions
in the rate are paid for by natural revenue growth and dynamic economic
growth that would occur as a result of the initial reduction. It
would not be necessary to cut core services or increase any other
tax rates, including property and sales tax.
The legislation introduced by the four senators is based largely
on a study conducted in late 2011 by the Oklahoma Council of Public
Affairs (OCPA) and Arduin, Laffer & Moore (ALM), the econometrics
firm co-founded by economist Dr. Arthur Laffer, once a key advisor
to President Ronald Reagan. OCPA and ALM demonstrated in the study
that states without personal income tax tend to enjoy economic growth
that far surpasses the states that levy a personal income tax.
The full report on the Laffer Plan can be found at: http://tinyurl.com/LafferPlanOK
For more information contact:
Sen. Holt: (405) 521-5636
Sen. Treat: (405) 521-5632
Sen. Johnson: (405) 521-5592
Sen. Brecheen: (405) 521-5586
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