Real Tax Reform that Helps Real Oklahomans
December 11th, 2009
Hello again, everybody! Clearly, the top issue in 2010 will be balancing the budget in the face of declining revenues due to the national economic slowdown. While funding the critical functions of government will be the top issue, an old battle likely will rear its head. Recently, former Gov. Frank Keating had a column in a statewide newspaper where he again touted a proposal to end Oklahoma’s income tax. By itself, that is a good policy; who wouldn’t want more money on payday? When you look closely at what that would mean for all families, its unfairness comes into sharp focus. A report from the Institute for Taxation and Economic Policy provides some of that focus. The report showed that low- and moderate-income Oklahomans pay a greater percentage of their incomes in taxes than do the very wealthy. The study confirmed what I have been saying for years: Oklahoma is too dependent on the sales tax – especially the grocery tax. The grocery tax by its very nature hits low- and moderate-income families the hardest. The top five percent of wage earners in Oklahoma – those making more than $165,000 per year – pay no more than 6.3 percent of their income in total taxes. The lower a family’s income, the greater percentage of it they pay in taxes. The lowest 20 percent of wage earners pay almost 10 percent of their income in total taxes. Wiping out the income tax only would make that disparity worse; those with more would pay even less. The burden of funding government would unduly fall to those least able to afford it with low- and moderate-income families paying an even greater percentage of their income in taxes. I have continued to advocate a different approach to cutting taxes for every Oklahoma family: repeal the grocery tax. No tax is more unfair to 95 percent of Oklahomans than is the grocery tax. While 2010 likely will not be the year to cut any tax given the critical budget shortfall we face, it is obvious discussions about tax policy will continue. Certainly, some will continue to support a tax structure that puts a greater burden on those least able to pay. As for me, I will continue the fight to further improve Oklahoma’s tax code by hammering away at the grocery tax. It took years for us to make the first dent in the sales tax with the “back to school” sales tax holiday. That victory was not an end to the struggle to create a more fair tax system. That victory – along with my efforts that cut taxes for every Oklahoma family when I was chair of the Senate Finance Committee – was the beginning. For as long as I serve as your senator, I will continue my efforts to create a tax structure that values all families, not just the wealthiest five percent. Thanks again for reading the “Senate Minute.” Have a great week, and may God bless you all.