House Republicans are pushing the conversation about more tax cuts forward with a slate of bills passed last week. The Senate's proposed budget, however, doesn't account for slashes to any more of Oklahoma's revenue streams.
Oklahoma House Republicans want more tax cuts, while Senate Republican leadership has left them out of their budget after slashing the grocery tax last month.
It’s the latest in an ongoing impasse between the two chambers on how best to cut taxes.
House Republicans advanced House Bills 2948, 2949 and 2950, last week, sending them over to the Senate. The three measures would lower the state income tax for individuals and corporations.
House Speaker Charles McCall introduced the bills. During a Monday press conference, he said if passed into law, Oklahoma would eventually have no income tax, as long as the state’s base revenues continue to grow year after year.
“I'm hoping that the Senate will consider those measures,” McCall said. “That does put us on a path to eventually becoming competitive with the most robust economies throughout the United States.”
But, after the Board of Equalization determined last month, lawmakers could spend $14 billion in Fiscal Year 2025 — $11.6 billion of which is recurring revenue — Senate Pro Tem Greg Treat has said further cuts are off the table. He said the state can’t afford a grocery and income tax cut.
“The math doesn’t add up to do both of them,” Treat said after the Board of Equalization determination was made.
The Senate, following a newly implemented budgeting process focused on transparency, approved its proposed budget via Senate Resolution 31 for the next fiscal year Monday, and it doesn’t account for any more tax cuts beyond the elimination of the state grocery tax already signed into law.
While the proposed budget is mostly flat for state agencies, the Senate is focused on bolstering certain areas. For example, the Oklahoma State Bureau of Investigation would see the largest annual budget increase of any agency for a new headquarters. Other criminal justice and judicial elements would also see relatively small increases to pay for updated technology and more staff.
The proposed Senate budget is not final. The House still needs to put its vision for the state forward after, which it will deliberate internally behind closed doors. Both chambers will then negotiate with each other and Gov. Kevin Stitt to reach a consensus. That normally happens in the final days of the legislative session.
Democrats in the House voted against all three of McCall’s bills. House Minority Leader Cyndi Munson said in a press release following the vote last week that House Republicans are pushing tax cuts that disproportionately benefit the wealthiest Oklahomans and large corporations.
