State Rep. Denise Crosswhite Hader, R-Piedmont, on Tuesday issued the following statement regarding her vote against House Bill 2962, which reduces personal income tax for all taxpayers but restores the Earned Income Tax Credit for those who pay little or no income tax.
HB 2962 was passed by legislators Tuesday by a vote of 81-19.
The bill proposes cutting the state personal income-tax rate from 5% to 4.75% and now moves on to the senate.
Crosswhite Hader said, “I’m certainly in favor of cutting personal income taxes. I would have voted in favor of this measure if it had not been combined with the restoration of the Earned Income Tax Credit, which is a form of welfare in that it provides money to people that have not paid into the tax system. The amount of EITC depends on a family’s earnings and number of children; the maximum credit in 2019 was roughly $5,800 for a family with two children. Making the EITC refundable means the full amount can be claimed even if it exceeds a taxpayer’s tax liability. So people who pay little or no income tax are still rewarded. While some might argue this is compassionate, I believe it keeps people from seeking better opportunities. The Oklahoma Tax Commission shows the credit was claimed on 303,403 tax returns for $16.1 million in Fiscal Year 2020.”
According to an article by Ray Carter, Oklahoma Council of Public Affairs reporter, Oklahoma’s top income tax rate kicks in at just $8,700 of taxable income for single filers and $15,000 for couples, and the lower rate is expected to reduce the tax burden on Oklahomans by a combined $170 million annually.
“This is a tax relief for every citizen of the state of Oklahoma, for every tax band, every income level—quarter percent … everybody gets it,” said House Appropriations and Budget Chairman Kevin Wallace, R-Wellston. “It’s not a tax relief for the wealthy or the privileged. It’s for everyone.”
Wallace said the rate reduction would save the average Oklahoma taxpayer $152 each year.
