Strengthen Working Families Tax Credits

Even while policymakers scramble to find ways to address the state’s continued budget crisis, expanding tax credits that primarily benefit low- and moderate income working families and seniors should be part of the tax policy discussion. Lawmakers should undo last year’s cut to the Earned Income Tax Credit as well as increase the Sales Tax Relief Credit.

Several bills were introduced this session that would expand tax credits for working families:

• HB 1383 by Rep. Carol Bush (R-Tulsa)  increases the Sales Tax Relief Credit;
• HB 12474 by Rep. George Young (D-OKC),HB 1311 by Rep. Collin Walke (D-OKC), and SB 434 by Sen. John Sparks (D-Norman) rolls back last year’s cuts to the Earned Income Tax Credit.

The bill to increase the Sales Tax Relief Credit, HB 1383, passed the House Finance subcommittee but was not heard by the full Appropriations and Budget Committee. None of the EITC bills were heard. These bills are dead for this session. However, there may still be a chance to include an increase in the Sales Tax Relief Credit or Earned Income Tax credit as part of the overall budget plan between legislative leaders and the Governor.

Please let your legislators know that you support strengthening working family tax credits as part of this year’s budget.

You can look up your Senator and Representative here, call the House switchboard at 405-521-2711, and call the Senate switchboard at 405-524-0126.

Talking Points on the Sales Tax Relief Credit (HB 1383)

• HB 1383 would help more than a million Oklahomans by increasing the Sales Tax Relief Credit, which is intended to offset the taxes paid on groceries and other essential items. The bill especially benefits families with children and seniors.
• The amount of the Sales Tax Relief Credit has never been increased since it was first set at $40 per household member in 1990.
• HB 1383 increases the credit from $40 to $60 per household member for those currently eligible for the credit, provides a half-credit of $30 for those with slightly higher incomes, and indexes eligibility for the credit to inflation.
• As legislators look at raising taxes and broadening the tax base to address the budget shortfall, increasing the sales tax relief credit would counterbalance the most regressive part our tax system for low- and moderate-income families.

Click here for a fact sheet on HB 1383.

Talking Points on Restoring the Earned Income Tax Credit (HB 1274, HB 1311 and SB 434)

• Last year, Oklahoma lawmakers cut the state Earned Income Tax Credit (EITC) by some $28 million by making it non-refundable. This cut increased taxes for over 200,000 working families by an average of $91 per household. A single mom with two kids working full-time at $10/hour  had her credit reduced by $231.
• The EITC is designed to encourage work by supplementing the wages of low-income workers. The EITC has been shown to promote work, reduce poverty and support children’s development.
• HB 1274, HB 1311, and SB 434 would simply restore the state EITC to what it was prior to its reduction last year by the Legislature.
• As legislators look at raising taxes and broadening the tax base to address the budget shortfall, restoring the Earned Income Tax Credit would provide breathing room in family budgets to ensure that basic needs are met and that other forms of assistance aren’t necessary.

Click here for a blog post on the state Earned Income Tax Credit.

You can look up your Senator and Representative here, call the House switchboard at 405-521-2711, and call the Senate switchboard at 405-524-0126.

This video from 2012 shares stories of how important these credits are for regular Oklahoma families.

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