Budget & Tax
Curtis Shelton | January 15, 2024
Do Oklahoma tax cuts benefit only the rich? No.
Curtis Shelton
What happens in Washington, D.C. often has an outsized influence on how we view issues in the states. This is certainly true of conversations on tax cuts.
Claims that tax cuts only help the rich go hand in hand with any plan that comes out of D.C. The sizes of our federal tax brackets are largely responsible for this, with the top federal income tax bracket starting at $578,000 for single filers and $693,750 for joint filers. While there is plenty of research showing all income brackets benefit from income tax cuts, the high income threshold of the top brackets provides easy fodder for tax-cut critics.
This idea of tax cuts being for the rich gets parroted during Oklahoma-tax-cut conversations—even though Oklahoma has a vastly different tax bracket structure.
Oklahoma has six income-tax brackets with the top bracket having an income threshold of $7,200 for single filers and $12,200 for joint filers. This is a far cry from the more than half-million dollars needed to qualify for the top federal bracket.
Data from the IRS show that 84 percent of all Oklahoma tax returns had a taxable income over $10,000. That means roughly 4 out of 5 returns in Oklahoma qualify for the top income tax rate. By contrast, only 1.2 percent of federal tax returns were taxed at the top federal bracket.
Those who claim that cutting the state income tax would only benefit the wealthy aren’t living in reality.
Curtis Shelton
Policy Research Fellow
Curtis Shelton currently serves as a policy research fellow for OCPA with a focus on fiscal policy. Curtis graduated Oklahoma State University in 2016 with a Bachelors of Arts in Finance. Previously, he served as a summer intern at OCPA and spent time as a staff accountant for Sutherland Global Services.