Budget & Tax

Ray Carter | May 19, 2022

Senate approves rollback of Fallin-era tax hike

Ray Carter

The Oklahoma Senate has voted to repeal one of the many tax increases imposed by the GOP Legislature during the administration of former Gov. Mary Fallin, tacitly conceding that prior tax increases are now contributing to the inflationary stresses harming working families statewide.

Senate Bill 1075 repeals a 1.25-percent sales tax imposed on automobile purchases in 2017, when lawmakers were engaged in a flurry of tax-hiking efforts that culminated in 2018 with the largest tax increases in state history.

“Oklahomans have had to endure so much throughout the pandemic, including skyrocketing inflation,” said state Sen. Kim David, R-Porter. “The price of vehicles, like most other products, has climbed significantly. Eliminating this sales tax will lessen some of the financial burden for hardworking Oklahomans as our state and nation continue to recover from the economic impacts of the pandemic.” reported that during the first quarter of 2017, the year Oklahoma lawmakers first imposed the new car tax, the average price on a new car ran $31,400 after incentives. But earlier this month, Kelley Blue Book reported that new car buyers were paying an average of $46,526. That’s an increase of 48 percent.

According to the CarGurus website, the average price of a used car in 2017 ranged from just over $17,500 to $21,590, depending on the brand. But used-car prices surged beginning in the COVID shutdown in 2020 and currently range between $28,000 and roughly $30,800.

That’s an increase of 60 percent for the lowest average-priced used-car sales.

The amount of state car tax payment owed by Oklahomans has grown in tandem with skyrocketing car prices, increasing the overall price of a vehicle purchase and further putting automobiles out of reach for many working families.

A fiscal analysis projects that the repeal of the car tax will save Oklahomans $188.3 million in the coming state budget year, which begins on July 1, 2022.

SB 1075 passed the Senate on a 35-9 vote that broke along party lines.

Despite having historic surpluses, SB 1075 was the only significant tax-relief measure announced by legislative leaders as part of this year’s state budget agreement.

Ray Carter Director, Center for Independent Journalism

Ray Carter

Director, Center for Independent Journalism

Ray Carter is the director of OCPA’s Center for Independent Journalism. He has two decades of experience in journalism and communications. He previously served as senior Capitol reporter for The Journal Record, media director for the Oklahoma House of Representatives, and chief editorial writer at The Oklahoman. As a reporter for The Journal Record, Carter received 12 Carl Rogan Awards in four years—including awards for investigative reporting, general news reporting, feature writing, spot news reporting, business reporting, and sports reporting. While at The Oklahoman, he was the recipient of several awards, including first place in the editorial writing category of the Associated Press/Oklahoma News Executives Carl Rogan Memorial News Excellence Competition for an editorial on the history of racism in the Oklahoma legislature.

Loading Next