Written by Dick Pryor on Wednesday April 13, 2011
It's mid-April, and time to think about taxes, but not in the traditional way. At least on Oklahoma Forum. While many Oklahomans are working on preparing their tax returns, our approach was to discuss the role of taxes and tax policy in state government and economic development.
One of the most enlightening portions of the program is the comparison of Oklahoma's tax burden to other states. According to the Oklahoma Department of Commerce, which is engaged in luring business to our state, Oklahoma's combined local and state tax burden is 41st in the nation. That is to say that 40 states have higher tax burdens than Oklahoma. Statistics from other organizations tell a similar story.
In 2008, MSN ranked Oklahoma as 50th in overall tax burden. The Tax Foundation scores Oklahoma's state and local tax burden as 37th highest, and well below the national average. That's one of the reasons Oklahoma is climbing the charts in terms of business-friendly climate. In 2009, The Tax Foundation rated Oklahoma 30th in its business climate index, and while that is lower than several other studies, that placed our state higher than Texas, Colorado and Missouri. The Tax Foundation scored Oklahoma 32nd in individual taxes and sales taxes, 40th in corporate taxes, 45th in gasoline taxes, and 47th in property taxes.
With those figures as a backdrop, our discussion centered on the importance of tax incentives to the economy and job creation, the trigger that will further reduce the top state income tax rate in 2012 (from 5.50% to 5.25%), the Bush tax cuts, and the state budget deficit. There was a lot more that we didn't have time to discuss, including a proposal to eliminate the income tax altogether (OCPA supports that idea, as does former Oklahoma governor Frank Keating). Plus, we didn't talk about gross production taxes, reviews of tax credits and incentives, property taxes (which are 4th-lowest in the nation), and the use of tax policy to influence state priorities.
Until next time,
Guests are (pictured above, left to right) Jonathan Small, Fiscal Policy Director for the Oklahoma Council of Public Affairs; Kyle Dean, Professor of Economics at Oklahoma City University and the Director of the Meinders School of Business Economics Research and Policy Institute; and (not pictured) David Blatt, Director of the Oklahoma Policy Institute.
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