OKPOLICY.ORG
Response to the May 14, 2025 press conference with Gov. Stitt and legislative leaders about the budget package for Fiscal Year 2026, which starts on July 1, 2025. [Video of Press Conference]
From Shiloh Kantz, OK Policy’s Executive Director:
Once again, a small group of Oklahoma lawmakers have met behind closed doors to develop our state’s budget, shutting out the public and many of their fellow legislators. After last year’s historic efforts for public discussions on budget issues, this year’s lack of transparency is a step backward for Oklahoma.
While the governor says he wants to make Oklahoma more “pro-business,” his rhetoric doesn’t match what business leaders call for. Business leaders need strong public schools, a skilled workforce, reliable infrastructure, and healthy communities. Instead of investing in those building blocks, this budget relies on poorly designed tax cuts that will strip hundreds of millions from state revenue — making it even harder to deliver on the basics Oklahomans expect.
At today’s press conference, the governor dodged the question: how much will these tax cuts actually save Oklahomans, and when? The truth is, most families might see just a few dollars a week — and it might not kick in until 2027. That’s a lot of sizzle for no steak.
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Points to consider
- The “path to zero” is built off triggered tax cuts. Oklahoma has twice tried and failed to implement tax triggers. Why are lawmakers trying a third time? [Learn More]
- Legislative leaders promised budget transparency leading up this session. This was not a transparent process. [Learn More]
- The framework for the tax cut package is built around HB 1539. Here is a fact check from a recent floor debate on that bill. [Learn More]
- Oklahoma business leaders favor investment over tax cuts, State Chamber poll says [The Journal Record] | [Oklahoma State Chamber: 2025 Oklahoma Business Leaders Poll]
- A 0.25% cut to the state’s income tax is expected to cost about $338 million annually, more than twice what the governor said during Wednesday’s press conference. For perspective, this is almost equal to what lawmakers appropriated for the Oklahoma Department of Mental Health and Substance Abuse Services during this fiscal year, which ends June 30, 2025. [FY 25 Appropriations to Largest Agencies] | [FY 25 Budget Highlights]
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How much will the taxes cost the state in lost revenue?
Based on modeling from the Institute for Taxation and Economic Policy:
- A 0.25% cut to Oklahoma’s personal income tax rate is estimated to cost $338 million annually.
- Flattening the bottom three income tax brackets is expected to cost $87 million annually.
- Eliminating the state’s income tax is estimated to cost $5.8 billion annually.
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What will Oklahomans see from these tax cuts? And when will they take effect?
- It’s unclear from the press conference when the tax cuts would tax effect, but some legislation proposed cuts that wouldn’t take effect until 2027.
- See the attached spreadsheet for a more detailed breakdown about how these tax cut proposals would impact Oklahomans by income bracket. [PDF]
