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April 6, 2013

Oklahoma tax cut opponents see history repeating

OKLAHOMA CITY — As Oklahoma Gov. Mary Fallin fights for an increasingly uncertain income tax rate cut, some state officials have wondered aloud whether history is repeating itself.

Last year, Fallin devised a dramatic, almost 2 percent cut in the income tax rate she said would save taxpayers millions of dollars, and with fellow Republicans holding majorities in both the House and Senate, it seemed to be a done deal. But one tax proposal became several and nobody could agree which was best, so the entire idea sunk last May.

Fallin tried again this year by pushing for a more modest cut, lowering the top income tax rate from 5.25 percent to 5 percent and saving the average taxpayer about $80. But disagreement between House and Senate lawmakers came into the spotlight this week after both chambers scuttled each other’s version of the proposal.

“This is exactly what happened last year: The House and the Senate had two different plans, the governor sort of had her own plan,” House Democratic Leader Scott Inman, D-Del City, told reporters Thursday, echoing his Senate counterpart Sen. Sean Burrage. Legislative Democrats have been solidly opposed to the proposal’s $130 million annual price tag, saying it would divert needed funds from education, corrections and other state priorities.

“With just a month and a half left of session, to be this far apart in how they cut it ... that is significant,” Inman said.

The two chambers have been working on their own proposals since the session began.

Last month, the Senate approved a bill that would lower the tax rate further than Fallin’s proposal —4.75 percent starting in 2015 — as well as eliminate a slew of tax credits and deductions. The next day, the House cleared Speaker T. W. Shannon’s bill matching Fallin’s original proposal. The chambers then swapped bills.

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