Could Tax Cuts Result in Wasted Tax Dollars?

Lawmakers are pushing ahead with an effort to cut Oklahoma's state income taxes, but opponents are questioning if it will waste tax dollars.

Wednesday, April 22nd 2009, 8:04 pm

By: News 9

Could Tax Cuts Result in Wasted Tax Dollars?

By Alex Cameron, NEWS 9

OKLAHOMA CITY -- Lawmakers are pushing ahead with an effort to cut our state income taxes, but their opponents are questioning it will waste tax dollars.

The last time Oklahoma's economy was down, state lawmakers decided to tweak the system so that state income tax rates couldn't be reduced below a certain level unless revenues were growing at least four percent, but now they want to do away with that trigger.

It comes at a time when state revenues are not only not growing by at least four percent, they're down almost five percent.

"We all want to cut taxes," said Paul Sund, spokesman for Governor Henry. "Governor Henry would love to cut taxes, but when you're facing a $900 million budget hole, it's just not realistic."

Budget-writers said federal stimulus money should help lessen that budget hole, but still said the future of this or any of the other tax relief measures that have passed this session is dubious.

More on News9.com: How the Stimulus Helps Oklahoma

The realities did not keep Republicans and many Democrats in the House yesterday from voting in favor of Senate Bill 315, which they said would stimulate the economy by putting more money in taxpayers' pockets.

Stimulus Watch: Track the Money

"We can take that money in and spend it, but we can't spend it as well as you can, the public," said Representative Guy Liebmann (R-District 82). "They're the best spenders that we have."

Some Democrats complained the vote was a political ploy by Republicans, who attached an amendment to the bill banning tax credits for embryonic stem cell research.

"The title was off the bill. It was never going to become law. The speaker knew it was never going to become law," said Representative Scott Inman (D-District 94). "The only reason for placing it on the floor was to try to get certain members to vote against it so they could use it against them in the next campaign cycle."

Republicans said taking up the bill was not political and was not a waste of time, claiming even if doesn't become law, it deserved a fair hearing, and that's what it got.

Because the bill was amended, it now goes back to the Senate, and is likely to sit in a conference committee while budget-writers figure out if there's enough money to pay for it.