Flush with cash, Oklahoma governor pushes for more tax cuts

February 6, 2023 GMT
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Trans-rights activists protest outside the House chamber at the state Capitol before the State of the State address Monday, Feb. 6, 2023, in Oklahoma City. (AP Photo/Sue Ogrocki)
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Trans-rights activists protest outside the House chamber at the state Capitol before the State of the State address Monday, Feb. 6, 2023, in Oklahoma City. (AP Photo/Sue Ogrocki)

OKLAHOMA CITY (AP) — With state savings accounts and revenue collections at all-time highs, tax cuts will be a top priority for Gov. Kevin Stitt and the Republican-controlled Legislature for the 2023 session that began on Monday.

Stitt, who easily won reelection in November, presented his executive budget proposal to lawmakers and delivered his fifth State of the State address to a joint legislative session. In it, he called for lawmakers to eliminate the state sales tax on groceries and cut the individual and corporate income tax rates.

“In my executive budget I am proposing to eliminate Oklahoma’s state grocery tax and reduce our personal income tax rate to 3.99%,” Stitt said. “These cuts will save each family in Oklahoma hundreds of dollars each year.”

Eliminating the 4.5% state portion of the sales tax on groceries would cost an estimated $351 million annually, while reducing the individual income tax rate from 4.75% to 3.99% would cost an additional $261 million, based on estimates from the governor’s office. Democrats in the House and Senate both have endorsed cutting the state’s grocery sales tax, and House Democratic Leader Rep. Cyndi Munson said they would do so again this year.

“Hopefully our colleagues on the other side of the aisle will join us,” said Munson, D-Oklahoma City.

Oklahoma currently has about $1.4 billion in its constitutional Rainy Day Fund and a separate revenue stabilization fund, and the amount of money available for lawmakers to spend on this year’s budget is expected to increase by another $950 million, based on December figures approved by the state Board of Equalization.

“With our fiscal discipline, economic growth, and our record savings, let’s make a significant statement that Oklahoma is here to stay on the national stage,” Stitt said.

Stitt also urged lawmakers to again target transgender children by prohibiting laws that allow gender-affirming medical treatment for minors, even as hundreds of activists chanted “protect trans rights” and “we are Oklahoma” in the rotunda outside the chamber.

“Minors can’t vote, can’t purchase alcohol, can’t purchase cigarettes. We shouldn’t allow a minor to get a permanent gender altering surgery in Oklahoma,” he said, prompting the gallery to erupt with applause and nearly all Republican members to give him a standing ovation. ”That’s why I am calling on the Legislature to send me a bill that bans all gender transition surgeries and hormone therapies on minors in the state of Oklahoma.”

Those proposals come after the governor signed bills last year to prevent transgender girls from playing on girls sports teams and requiring students in public schools to use only the bathrooms that correspond with their gender at birth.

“Talking about the indoctrination in our universities and to just totally disregard and ignore the people who are outside fighting for their lives, asking their state leaders to recognize them as whole human beings, to bring up those two issues was quite frustrating and really upsetting,” Munson said.

Lawmakers also are likely to pass a pay raise for teachers, although the details will be hammered out during the session. State Sen. Adam Pugh, the chairman of the Senate Education Committee, unveiled a plan last month to give an across-the-board teacher pay raise of between $3,000 and $6,000, based on years of service. But the governor’s Secretary of Education and new State Superintendent Ryan Walters has put forth a plan to give merit-based pay raises to teachers.

The Legislature also is likely to again consider a plan endorsed by Stitt and Walters for a voucher-style plan to divert public education funds from public schools to private schools, although the proposal remains unpopular with many House Republicans, particularly those in rural areas.

A number of bills also have been introduced by Republicans this year to restore some of the abortion restrictions that were imposed last year, including a bill that would allow abortions in cases of rape or incest that have been reported to law enforcement and clarifying the definition of when an abortion is allowed in cases of medical emergencies that threaten the life of the mother.

“That bill is supported and endorsed by Oklahomans for Life, so I would anticipate (it) has a chance of passing,” said Rep. Jon Echols, majority floor leader in the House. “I definitely think it will get considered.”


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