Measures Expected To Bring In Millions In Revenue Could Be Headed To Supreme Court
OKLAHOMA CITY - As complicated as the state budget picture has been this legislative session, it could actually get even more complicated several months from now.
That's because it appears that some of the revenue-raising measures lawmakers are finessing through tight House and Senate votes are going to be challenged in court for not meeting the requirements of State Question 640.
In 1992, Oklahoma voters narrowly approved SQ 640, amending the constitution so that any future revenue-raising bills would need three-fourths majority votes in both the House and Senate in order to be sent to the governor's desk. There have been disputes over the years, though, as to just what constitutes a revenue-raising bill.
The Oklahoma Supreme Court may soon have to weigh in on that question.
Tuesday the Oklahoma Council of Public Affairs, or OCPA, announced plans to file legal challenges to three measures, allegedly for violating the requirements of State Question 640:
HB 2403, passed Monday by the House on a vote of 56-40, less than 75%. It must still get through the Senate and be signed by the governor. The bill would limit itemized deductions, which will result in the state collecting about $101 million more in personal income taxes annually.
"This bill is an income tax increase of over $101 million a year," stated OCPA President Jonathan Small, "that targets Oklahomans who own a home with a mortgage, who pay property taxes that support local schools and other services, or who are being crushed by heavy medical bills."
HB 2348, passed earlier this session and already signed into law, this measure caps the standard deduction and, it’s estimated, will bring in an additional $19 million to the state annually. It passed on a vote of 51-44 in the House.
SB 1606, passed in 2016 and was signed into law. It also placed new limits on itemized deductions in Oklahoma. It was estimated at the time that it would raise $97 million in new tax revenue for the state. It passed in the House on a vote of 51-42.
Because each of these measures results in increased tax collections for the state, OCPA contends they are revenue-raising measures and, as such, must meet the three-fourths majority requirements of SQ 640, which they did not.
Supporters of these measures say they are not tax increases, per se, but rather adjustments to the tax code and therefore are not subject to the three-quarters majority rule.
Another potential showdown is brewing over HB 2429, passed on the House floor Tuesday by a vote of 54 to 44. The bill would increase the tax on certain oil and natural gas production from 1% to 4% for a limited period of time.
Supporters of the measure, fending off questions over the lack of a three-quarters majority, call it a 'rate adjustment' and not a tax increase.