STATEMENT: Tax cut plan follows a bad example

OK Policy released the following statement on the latest tax cut proposal by Governor Fallin and Legislative leaders:

Since 2008, Oklahoma public schools have endured the third largest budget cuts in the nation. Out of control tax breaks contributed to a collapse in revenue from oil and gas drilling. We still don’t know what will be the full cost of State Question 766 or what impact federal budget cuts will have on Oklahoma’s core services.

In this situation, it’s not the time for more tax cuts that would do little to help average Oklahomans, take $237 million from schools and other core services, and make Oklahoma more vulnerable to an energy bust or economic downturn. The Governor and legislators have partially recognized these facts by dramatically scaling back tax cut proposals from last year and by deferring more income tax cuts until 2015 and 2016. Yet the proposal announced today would commit us to tax cuts two years from now, when we have no way of knowing what Oklahoma’s needs or economic situation will look like.

The leadership agreement also leaves many sensible tax reform proposals off the table in favor of an unpaid-for tax cut. Over the final weeks of session, there is still time to do away with unnecessary tax breaks, especially the double deduction for state income taxes and the uncapped tax credit for horizontal drilling.

Today Kansas is burning through state reserves and heading towards a more than $500 million deficit due to irresponsible tax cuts. Oklahoma should not follow their bad example.

You can use this form to tell lawmakers that tax cuts at the expense of Oklahoma’s schools and other core public services are unacceptable.

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ABOUT THE AUTHOR

Gene Perry worked for OK Policy from 2011 to 2019. He is a native Oklahoman and a citizen of the Cherokee Nation. He graduated from the University of Oklahoma with a B.A. in history and an M.A. in journalism.

10 thoughts on “STATEMENT: Tax cut plan follows a bad example

  1. Please do not pass legislation to cut taxes when Oklahoma’s core public services – like public schools – are in such dire straights already. We have watched as Kansas and other states who followed this path are foundering and going into debt. This is not the time. We need to start putting reasonable amounts of revenue into schools and other public services.

  2. In my opinion a quality and thorough education should be available to all children regardless of social or economic background. This sends a dire message to our youth, Oklahoma should not be so relaxed in policy and budget where public education is concerned. Quality teachers need the pay they deserve and the recognition & support of the State.

  3. Aren’t we tired of being 49th in educational spending? What message are you sending to parents, teachers, and students?
    You are telling them that party politics and big business are more important. So very sad. I don’t feel represented or heard.

  4. At a time of continuing economic uncertainty, these cuts are unwise and will result in further deterioration of our schools, roads, and public services. Before lowering tax rates, it is imperative that our lawmakers reform a tax code that is freighted with special interest tax breaks.

  5. As a teacher, I see first hand what we lack in our schools. Expectations continue to increase, yet we do not have the resources that we need to meet these expectations. Please do not pass these tax cuts.

  6. I contacted my representative about this issue and was pleased to receive a response. However, I want to check the facts. Here is what he said:

    “Every time we’ve lowered income taxes we have seen higher revenues to the state. The last tax cut of $25 million resulted in $47 million in revenue. We have studied the issue and people in the USA are moving where state income taxes are lower. This bill is good for Oklahoma. We are being conservative in how much we ask for to make sure we can meet our core needs.”

    Is there some documentation of this causation?

    1. The idea that tax cuts will lead to revenue increases has been rejected by every serious economist: https://okpolicy.org/thats-a-laffer-top-economists-unanimously-reject-that-tax-cuts-will-yield-higher-revenue

      Tax cuts do tend to be enacted when the economy is already doing well, so in some cases revenues go up following a tax cut. But they don’t go up as much as they would have otherwise, and when a recession hits, education and other core services are hurt even worse.

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