Oklahoma’s Senate passed a bill Wednesday to cut the state’s railroad rehabilitation credit in half.
Sen. Mike Mazzei said a lot of rail companies probably don’t need it.
"This particular tax credit goes to for-profit companies, one of which belongs to Warren Buffett," Mazzei said. "And I'm not sure Warren Buffett needs any tax credit to help his railroad organization do some rehabilitation."
The bill reduces the credit from 50 percent of project costs to 25 percent.
"Railroad reconstruction has made a lot of progress in the state of Oklahoma, and it's probably a net economic benefit to continue the credit, not eliminate it," Mazzei said.
According to Oklahoma Watch, the income tax credit cost the state $1.1 million in fiscal year 2010 but just $352,000 in fiscal year 2014.
Mazzei said the credit is part of a bigger problem.
"The total cost of all the tax preference items on our books — which include tax credits, tax rebates, tax deductions, tax exemptions — all of that together adds up to $2 billion," Mazzei said.
The credit remains freely transferable at any time within five years of when a railroad company qualifies for it.
