Democratic State Lawmakers Criticize Fallin Tax Cuts

The state's republican caucus has announced proposed changes to Oklahoma's income tax rates.

Governor Mary Fallin made the announcement about a deal with fellow republicans to lower the income tax rates.

At a press conference Thursday night the governor said, "We know that bringing the best jobs to Oklahoma, we'll have to have one of the most competitive business environments and by having one of the lower income taxes in the country, we'll make Oklahoma competitive."

Democrats were quick to respond Friday, saying the deal will actually increase taxes on low income earners. Senate Minority Leader Sean Burrage said the math doesn't add up because the state cannot reduce its income without making additional budget cuts. He called the proposal reckless.

"It's a tax cut on the top earners," explained Sen. Burrage. "It's actually a tax increase to the low income earners in the state of Oklahoma."

CPA Robin Byford at Stillwater National Bank weighed in, saying there was truth to both arguments. She said the changes would be a draw to businesses since they look at income tax levels when deciding where to open up office locations.

Byford added that the biggest tax breaks will be for the top-tier earners, but also said lower-income families probably would not end up paying more, which leaves the middle class families, who might.

"The personal exemption amount of $1,000 per exemption or per dependent on your tax return will be eliminated for married [couples] filing joint over $70,000," explained Byford. "Therefore they may end up paying just a little bit more tax."

The proposal would reduce the state's current seven tier system to a three tier system. It also removes other tax credits and would reduce personal income tax rates by nearly one-half of 1 percent.

Byford says the state's growth and recent increase in the number of people coming to work in Oklahoma should make up for lost income because of the lower tax rate.

"Although the rates are going to be lower, I'm thinking that there will be, you know, more tax paid, in effect," said Byford.

Democrats vowed to bring any potential cuts to core services to the public's attention. Republicans said they were not planning on cutting those programs.