OKLAHOMA CITY (KFOR) –
Most Oklahoma citizens and businesses will have more money in their bank accounts in 2022 thanks to new tax cuts. Advocates say it will help fight inflation. Opponents say it’s not big enough to make difference for the average taxpayer.
The average Oklahoman will save about $130 next year. Those making more will save more. But the State of Oklahoma will likely lose about $137 million in tax revenue with the personal and corporate tax cuts. Advocates say the cuts will help attract new business to Oklahoma. Opponents say that money should be spent elsewhere and the cuts wont have the desired effects.ADVERTISING
“When people have more money to spend, they spend more money,” said Rep. Charles McCall of Atoka.
Speaker McCall is talking about the benefits of the .25 percent personal and 2 percent corporate income tax cuts he pushed to get through last session. McCall pointed out 85 percent of Oklahomans will pay less in personal income taxes in 2022 with the median $53,000-a-year earner saving about $81.
“This tax cut is going to be nothing more than a decent dinner at Chilis,” said Rep. Andy Fugate of Del City. “I think it clearly reflects misplaced priorities for the state of Oklahoma.”
Rep. Andy Fugate of Del City says a grocery sales tax cut makes more sense to help Oklahoma families, and that those state tax dollars lost should go to mental health and substance abuse help in the wake of Oklahoma’s criminal justice reform.
But McCall says with the reinstatement of the earned income tax credit, lower income Oklahomans will get a boost. He says state revenues are at an all-time high, the cut is needed to fight a bigger battle.
“In order to be able to combat inflation, people need to have more money in their pocket to buy goods that are now costing more dollars,” said McCall.
Gov. Kevin Stitt’s office agreed with McCall. They issued the following statement to KFOR:
“Governor Stitt was proud to sign into law legislation to cut taxes for every Oklahoman so that they can keep more of their hard earned money and remains committed to making our state’s business taxes among the lowest in the nation to help recruit and retain companies.”GOV. KEVIN STITT’S OFFICE
Stitt’s office referred to the corporate income tax cut from 6 to 4 percent. But opponents say those millions of dollars cut will be felt in the state budget. Some say that price isn’t always what brings new companies to Oklahoma, citing electric car company Canoo picking Arkansas, with its higher tax rate, over Oklahoma for their new headquarters.
“Unfortunately, a lot of firms are not focusing on that marginal tax rate for their profits when they chose a location. They are really looking more at the infrastructure and human capital available, that is, is the work force capable of handling the work?” said OCU Economics Professor Jonathan Willner.
But economists and McCall agree the corporate tax cuts could lead to more reinvestment of dollars by Oklahoma companies in turn growing Oklahoma’s tax base. The new tax cuts takes effect Jan. 1.