Proposed State Tax Reform Would Increase Federal Taxes

By Pitts, William | THE JOURNAL RECORD, March 18, 2002 | Go to article overview

Proposed State Tax Reform Would Increase Federal Taxes


Pitts, William, THE JOURNAL RECORD


It may come as a surprise to many Oklahomans, but they could wind up paying more taxes under Gov. Frank Keating's tax reform plan, only it would be to the federal government. It may be revenue- neutral for the state, but it wouldn't be for many state taxpayers.

The least publicized fact about the governor's plan is that Oklahomans would be paying the same amount of state taxes, while paying millions more in federal income taxes each year.

The reason is simple. Oklahoma's income tax produces about $2 billion annually, which is a deductible amount on federal income taxes of many Oklahomans. Increased sales taxes on goods and services, also paid by Oklahoma consumer tax payers, to make up this loss to the state treasury are not deductible for the federal tax.

Somehow this seemed to have escaped much mention in the early bloom for doing away with the state income tax and substituting new taxes for it. The question is, was it just overlooked, or merely carefully ignored?

According to one source the Oklahoma Tax Commission did a study for the 32-member citizen/legislator task force on tax reform. It determined Oklahomans would pay $320 million dollars more annually in federal income taxes under the Keating plan.

Some may argue this is a reason not to cut the state income tax rate, but if it is reduced without offsetting tax increases the taxpayer obviously still benefits. That definitely is not an option for the task force or the Legislature at this time.

While the governor's plan has met stiff opposition in the business community and the Legislature, to a lesser degree the same facts would apply under other plans being considered.

Rep. Clay Pope, D-Loyal, chairman of the House Revenue and Taxation Committee, proposed a plan to set the income tax rate at 5 percent and increase the current state sales tax to 6.9 percent.

Senators on the task force reportedly have come up with a plan to reduce the income tax rate from 7 to 5 percent and levy a sales tax on the same services Texas taxes, but exclude rent and financial services.

In a few weeks, the voters should have some inkling of which if any of these plans is to be submitted to them. The task force is scheduled to make its report by April 12.

It was appointed by House and Senate Democrat leaders, the governor and Republican legislative leaders.

Democrat legislators on the task force include Sen. Cal Hobson, D-Lexington, Senate president pro tempore designate, and Sen. Angela Monson, D- OKC, chair of the Senate Finance Committee; Pope and Rep. Debbie Blackburn-D-OKC.

Republican legislators include Sen. Mike Johnson, R-Kingfisher, Sen. Jim Williamson, R-Tulsa, Rep. Todd Hiett, R- Kellyville, and Rep. Forest Claunch, R-Midwest City.

Citizen members of the task force are a diverse group. They include businessmen, tax attorneys, CPAs, an economist, representatives of business groups, education and local government officials, and former legislators.

Co-chairing the group is Don Davis, Lawton, a former Democrat legislator who now serves as president of Cameron University, selected by Senate President Pro Tempore Stratton Taylor, D-Claremore, and House Speaker Larry Adair, D-Stilwell. Howard Barnett, the governor's chief of staff, is the other co- chair.

Many of the citizens and legislators on the task force previously expressed the belief that tax reform is desirable, but there are differences among its membership over what should be done. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Proposed State Tax Reform Would Increase Federal Taxes
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.