OKLAHOMA CITY (AP) — Leaders in the Oklahoma Legislature are moving quickly now to pass revenue increases before unveiling a formal budget plan that would close an estimated $1.3 billion shortfall.
Lawmakers on Thursday took some of their biggest steps yet toward plugging the revenue gap for the fiscal year beginning in July, advancing roughly $274 million in proposed revenue increases for final consideration by the Legislature or the governor.
“I think it’s incredibly important to know how much money is available before we start talking about how much money we’re going to spend,” House Speaker Jeff Hickman said.
The Oklahoma Senate passed a bill that would eliminate $133 million in tax rebates for certain oil and gas wells considered “at risk” because they produce little profit. The rebate allows producers of such wells to recoup nearly all of the taxes paid on production. The bill awaits Republican Gov. Mary Fallin’s signature for final passage.
And more revenue increases could soon be on the way. Joint committees for the House and Senate voted to allow each chamber to consider final proposals to eliminate $97.3 million in state income tax deductions, cut $29 million in tax credits and raise $15 million by issuing new license plates.
Under one proposal, Oklahoma residents would no longer be able to benefit from itemized deductions on their state tax returns if they also claimed them on federal returns. The second-largest proposal the committees passed would eliminate the portion of the Oklahoma Earned Income Tax Credit that exceeds the recipients’ income tax liability.
The committees also approved an additional $129,000 in cuts to tax credits for a small number of businesses that offer certain on-site child care services. Two dozen businesses apply for this credit each year in the state.
Meanwhile, the House passed a bill that proponents hope helps the state collect more revenue from online purchases, although the proposal wouldn’t affect next year’s budget shortfall.
The bill would require out-of-state retailers to notify their Oklahoma customers they may owe taxes on their online purchases when filing state tax returns. The bill would also require these retailers to provide residents with an annual report of how much they spent on online purchases.
Bill supporters said the proposal would help some local retailers struggling to compete with their out-of-state, online competitors.
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