2016 ushers in tax cut for some in oklahoma _ news ok

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com. 2016 ushers in tax cut for some in Oklahoma As the calendar rolls over to 2016, more than 1.7 million Oklahomans can look forward to a state income tax cut. The state’s top income tax bracket will drop from 5.25 percent to 5 percent with the beginning of the new year. For most, it won’t be a huge windfall. Taxpayers with federal adjusted gross incomes of $40,000 to $44,999 a year can expect to save about $35 a year, while taxpayers with adjusted gross incomes of $100,000 to $149,999 a year can expect to save about $160 a year. “This tax cut will make Oklahoma a better place to do business, meaning more opportunities and jobs for Oklahoma families and more revenue for core government services,” Gov. Mary Fallin said Thursday.

State lawmakers actually approved the graduated tax cut back in 2014, but the first benefits of that tax cut are only now being realized by taxpayers. That’s due to triggers that were put into the law that required revenue projections to reach certain levels before the cuts could begin.

A further tax cut to 4.85 percent is possible two or more years down the road if future revenues improve sufficiently. More than 1.7 million Oklahoma taxpayers are expected to receive some benefit from this year’s initial reduction. Oklahoma’s top income tax bracket of 5.25 percent for tax year 2015 applies to individuals who make more than $8,700 a year and couples who make more than $15,000 a year. That top tax rate will drop to 5 percent for tax year 2016 and will apply to individuals who make more than $7,200 a year or couples earning more than $12,200 a year. While a 0.25 percent tax cut may be enough to make some Oklahomans smile, some state employees are more worried than pleased. The tax cut is expected to exasperate state budget problems caused primarily by a huge slide in worldwide oil and gas prices that has caused Oklahoma to lose about 11,600 energy jobs and has sent ripples throughout the state’s economy. State finance officials have already told state agencies they will have to absorb 3 percent cuts in their monthly general revenue allocations for the remaining six months of the current fiscal year to make up for a projected $157 million shortfall.

The financial situation is expected to be much worse for the fiscal year that begins next July, when state officials project the state will have at least $900 million less to spend, which is about 12.9 percent less than was allocated for the current fiscal year. Gov. Fallin predicted the long term benefits of the tax cut will be worth the short term sacrifices. “Of the six personal income tax reductions that have taken effect under Republican and Democrat governors since 1998, all but one were followed by revenue growth upon taking effect,” Fallin said. “The only exception is the tax reduction passed in 2001 that took effect during a subsequent recession in which all major tax streams were declining.

Like the 2001 reduction that has since proven its worth over time, the measured tax reduction effective Jan. 1 is starting during a major oil price collapse that is causing declines in all major tax categories. Once the price of oil rebounds, I am confident this tax cut will prove its worth in the long term.” “Tax policy is long-term policy and, over the long term, a lower tax burden is good policy and the policy the voters have asked for in Oklahoma,” Fallin said. “If Oklahoma wants to attract and retain good jobs — rather than losing them to neighboring states — we must improve our tax climate.

” Randy Ellis For the past 30 years, staff writer Randy Ellis has exposed public corruption and government mismanagement in news articles. Ellis has… read more › Comments At a glance: What’s new A cut in the state’s income tax rate is not the only new law that will begin impacting Oklahoma residents Jan. 1. While new laws can be written to take effect on various dates, the Legislature passed 10 laws last year that were designed to take effect at the start of the new year. Following are brief summaries of a few of them: •Senate Bill498 prohibits wind electricity manufacturers from claiming the state’s five-year ad valorem tax exemption for assets placed in commercial operation after Dec. 31, 2016. • Senate Bill 372 makes it a misdemeanor for a person to operate a motorcycle on a pubic road without a proper motorcycle endorsement on the individual’s state-issued driver’s license. A person charged with a violation is allowed to request a six-month deferral of punishment to allow them to complete requirements to obtain an endorsement.

•Senate Bill 312 modifies dates that that school districts, municipalities, counties and other political subdivisions can hold elections to fill elective political offices. It permits such elections on the second Tuesday of February and the first Tuesday of April in any year, on the date of any regularly scheduled statewide state or federal election in an even-numbered year, and on the second Tuesday of September and the second Tuesday of November in an odd-numbered year. •Senate Bill 806 requires all economic incentive legislation enacted after Jan. 1 to have a measurable goal or goals. It applies to all future legislation involving things like tax credits, exemptions, deductions or rebates.

•House Bill 2242 shifts $25 million from the state’s Unclaimed Property Fund to the state’s Special Cash Fund and makes the money available for appropriation. •Senate Bill 457 allows the issue of a child’s competency to participate in a delinquency proceeding to be raised by the child’s attorney, the district attorney or the court and allows the issue to be ruled on by the judge without a competency evaluation or hearing if parties involved in the case agree.