OKPOLICY.ORG
By Charles M. Phipps, OK Politechs
I don’t agree with much at all of what the Oklahoma Policy Institute puts out, but their information about the recent tax cut legislation passed by the Oklahoma legislature and signed into law by Governor Fallin is right on the money. Opinions about policy can vary, but numbers don’t lie.
I’ve looked at the new tax rates in House Bill 2032 and I’ve run the numbers against the tax rates in this year’s form 511 – the Oklahoma individual income tax form. What the numbers tell me is that the things being said by Governor Fallin, Speak of the House T.W. Shannon and others are highly misleading. Do you think you’re getting a tax cut? Unless you’re on the poverty level, you are, but let’s see how much.
Below is a chart from the OK Policy Institute’s post about the tax cut. It’s accurate. As you can see, if you make between $19,500 and $36,400 your tax cut is going to be a whopping $9. If you make between $36,400 and $58,100 your tax cut will be $30, which might be enough for half a tank of gas. And don’t forget; this doesn’t take effect until 2015, more than a year and a half away.
http://4.bp.blogspot.com/-gQclYoXMM6E/UZfba0NNCGI/AAAAAAAAArY/6Fp4vDsgg8o/s1600/average-tax-cut-2.jpg
Looking at the chart you can see the higher incomes are getting the biggest cuts. That’s as it should be. People who make more money pay more taxes and therefore, will get larger amounts when taxes are cut. I am certainly not one of the people who decry the ‘rich’ getting bigger tax cuts than the middle or lower income levels. I know full well the positive effect that tax cuts have on our economy, especially when the higher income people have more of their money to invest in their businesses or other ventures.
What I will decry, however, is being sold a bill of goods by the Republican leadership in Oklahoma when they tout this tax cut as something it definitely is not. For example, in her press release on May 13, Governor Fallin said, “Oklahomans have already seen their paychecks decrease, beginning in January of this year, thanks to Washington’s tax hikes. Cutting our state income tax will help to offset that loss, and help working Oklahomans keep more of their hard-earned money.”
Speaker Shannon said, “By lowering the income tax rate, we are attracting skilled and educated workers to our state and making Oklahoma a leader in business and economic growth.” Apparently he believes $9, $30, or even $81 will bring workers to our state. Please, someone give that man a drug test.
According to the Census Bureau the average household income in Oklahoma is $44,287, which means more than half the households in Oklahoma will get $30, $9 or $0 as their tax cut. And not until 2015. Yes, that will really help offset Washington’s confiscatory tax policies.
If Governor Fallin isn’t careful there will be many more people in Oklahoma who refer to her as a few of my Democrat coworkers do – Governor Failin’.
While I am not at all pleased with the way this tax cut is being handled or with the amounts, that does not mean I will be abandoning the Oklahoma Republican Party. Having lived in Oklahoma all my life I know full well the disaster we would face if the Democrats were able to come back into power. Governor Fallin and the Republicans have done a lot of positive things in Oklahoma and our economy is one of the leading state economies in the nation. I’m sure the Republican leadership knows the benefits to our economy of having top wage earners keep more of their money. The rest of us are just stuck with the crumbs. I’ll take the crumbs, but don’t tell me it’s cake.
And there’s one other thing to mention. Since 1992 when Oklahoma residents passed a Constitutional amendment preventing the legislature from raising taxes without a vote of the people, a favorite trick of the legislators has been to increase the amount for fees, licenses and permits. Among the fee increases about to take effect is a $12 increase in renewing a drivers license. Bye bye minuscule tax cut.
http://www.charlesmphipps.com/2013/05/governor-fallins-misleading-tax-cut.html
