For Immediate Release: May 15, 2012
Sen. Mike Mazzei explains the Senate's income tax reduction plan
at a press conference Tuesday.
Senate GCCA approves income tax reduction measure
The Senate General Conference Committee on Appropriations
has given approval to Senate Bill 1230, a measure Senate author
Mike Mazzei said would result in meaningful income tax reductions
that would stimulate the economy while truly protecting core services
such as education, public safety, health care and transportation.
The plan would reduce the top income tax rate to 5 percent in
2013 and 4.75 percent in 2014.
“For nearly a year, we’ve been examining Oklahoma’s
tax code and uncovering millions and millions of dollars in special
tax deals and loopholes that don’t really grow long-term
high-paying jobs. We’ve also seen that lowering the rates
on Oklahoma taxpayers while increasing the base of taxpayers stabilizes
the revenue stream for core services while stimulating economic
growth,” said Mazzei, R-Tulsa. “By keeping those tax
credits and breaks that work, modifying those that need adjustments
and pitching those that don’t benefit our economy, we’ve
been able to create a tax cut plan that is fully paid for in Fiscal
year 2013 and 2014, protecting our core state services.”
Mazzei, Senate Finance Committee Chairman, said the tax reductions
did not come at the expense of low income Oklahomans, veterans
or seniors living on a fixed income. He also stressed that while
the plan relies on the elimination of ineffective tax credits
and modification of others, it does not achieve a tax reduction
through the use of revenue triggers.
“We do not believe triggers are a responsible approach given
the different volatilities that could impact our economy, such
as collapsing natural gas prices and continued instability in
European financial markets.”
Mazzei highlighted those credits and breaks to be retained, those
that will be altered and those targeted for elimination.
Retained:
• Preferences for retirees and active duty military personnel;
• Standard and itemized deductions;
• Treatment of net operating losses;
• Capital gains deduction;
• Volunteer firefighter credit;
• Nonrecurring adoption expense deduction; and
• Tornado property damage credit.
Modified:
• Personal exemption allowed only for those under specified
income thresholds ($35,000 for single filers and $70,000 for joint
filers);
• Grocery sales tax relief allowed, but no longer refundable;
• Transferable credits made refundable, value reduced by
20% and sunset applied as applicable;
• Value of preference reduced by 20% for Film Rebate program,
donations to scholarship organizations, CNG investment credits
and the investment/new jobs credit; and
• Child/child care credit eligibility changed from income
of $100,000 to $50,000.
Eliminated:
• Over 30 tax preferences available to businesses; and
• Some preferences available to individuals including: low
income property tax credit and state earned income tax credit.
“I’m extremely proud of our members
who have taken on the complex challenge of giving Oklahomans
thoughtful and sustainable tax reform, ensuring our citizens are
the top priority, not the special interests and their sacred cows.”
Copy of SB 1230
Copy of Senate tax reform proposal
Senate tax reform summary
