Budget & Tax

Michael Carnuccio | May 22, 2015

Free Market Friday: Taxpayers protected

Michael Carnuccio

It appears to be the legislative session’s final week. This is also the time of year taxpayers can be grateful. On March 10, 1992, a majority of Oklahoma voters decided, with the passage of State Question 640, that state lawmakers’ ability to raise taxes and revenue needed to be restrained. The measure requires that bills creating or increasing taxes, or making new revenue sources for the purpose of funding government, start in the House of Representatives, must be submitted to a vote of the people or receive three-fourths approval by both legislative bodies, and be passed prior to the last five days of the legislative session.

Prior to this protection, Oklahomans were repeatedly burdened with tax increases that appeared in legislation after hastily crafted budget agreements that needed more from the pockets of Oklahomans.

A number of bills filed this year included tax increases. For example, a measure was filed to increase the tax on tobacco products nearly 100 percent. The measure wasn’t heard due to fierce opposition from across the ideological spectrum. Prior to SQ 640, a measure like this would have been resurrected in a late-May budget agreement and included with other acceptable measures, thus allowing it to receive coerced support. Thanks to SQ 640, a proposal such as this likely can’t be resurrected due to the fact that it would violate the deadlines according to the constitution and would have to be submitted to a vote of the people, thus resulting in appropriators being unable to count on any revenue.

Some disparage SQ 640, saying that it makes it impossible for state government to raise revenue. Reality proves otherwise. Since 1992, more than a dozen revenue-raising measures have been enacted, including a personal income tax increase and a provider tax.

However, for two decades, last-minute efforts to increase personal income taxes on Oklahoma families or create new revenue streams for Oklahoma’s ever costly Medicaid program have been thwarted by conscious policymakers and one of the taxpayers’ greatest friends, SQ 640.

While this year’s budget agreement was hastily announced and appropriates more than last year, most taxpayers can rest assured they likely won’t see any tax increases this year to pay for the fiscally irresponsible increased spending.

Michael Carnuccio

Former OCPA President

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