Friday, April 20, 2012

Who wants an Oklahoma income tax cut?

On Wednesday, the Oklahoma Senate passed a bill to cut the state's income tax to a top rate of 4.9 percent. While this might sound appealing on the surface, it would result in cutting important public services--like healthcare and education. And to get to this lower top rate, deductions and credits for ordinary working people would have to be sacrificed, meaning that rich people would pay lower taxes and poor people would pay higher taxes. Vital public services have already been cut drastically in the wake of the Great Recession.

The Oklahoma Policy Institute has been doing a lot of work on analyzing this issue, and they have a page of links devoted to information about this important topic. This morning, a post on OPI's OKPolicy Blog shows that most of the support comes not from Oklahomans--even business groups are wary of it--but from outside pressure groups. Among these groups (no surprise) is the notorious American Legislative Exchange Council (ALEC):
So where is it coming from? It’s no coincidence that very similar efforts to eliminate the income tax are popping up in Kansas and Missouri. All three campaigns rely heavily on a report by Arthur Laffer, a former Reagan advisor who has dedicated his career to restricting taxes in numerous states. Governor Fallin mentioned Laffer’s numbers in this year’s state of the state speech, though she cited them as coming from Americans for Prosperity, a national lobbying group founded by David and Charles Koch. Most recently, Governor Fallin wrote the introduction for a report by Laffer and others at the American Legislative Exchange Council (ALEC) that ranks states based on how closely they follow ALEC’s economic policy agenda. It’s clear that these national groups have the governor’s ear.

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