(The Center Square) - Tax relief that could include one-time rebate checks and a temporary suspension of the sales tax on groceries could be on the horizon for Oklahomans as several bills make their way through the Legislature.
The options include a one-time income tax rebate of $125 for individuals and $250 for households under House Bill 1358. The total estimated amount of these rebate payments to taxpayers would be around $321 million, House Speaker Charles McCall said.
A permanent income tax rate reduction from 5% to 4.75% is also under consideration. House Bill 3350 would save the average taxpayer $121 per year, according to the Oklahoma Tax Commission. It would bring Oklahoma from the ninth-lowest to seventh-lowest income tax rate in the nation if it passed, according to the Tax Foundation.
Two bills would reduce the state's tax on groceries. House Bill 3349 temporarily would suspend the 4.5% state grocery sales tax for two years. It would not affect local sales taxes on groceries, according to McCall's office.
House Bill 3353 would provide a two-year enhancement of the grocery sales tax credit for low-income Oklahomans. This would increase the tax credit to up to $180 a year for those who qualify, McCall said.
An elimination of the corporate income tax also is up for discussion. House Bill 4358 would phase out the corporate income tax over the next eight years.
"Corporate income tax is an outdated, volatile revenue source that is ultimately unnecessary in the long term, due to the changing nature of business structures," said Rep. Jeff Boatman, R-Tulsa, one of the sponsors of the bill. "A steady phasedown of this tax protects the budget and sends a positive message that Oklahoma is open for business."
McCall said the hope is to aggressively fight inflation while not harming the state budget, adding that none of the bills in question are expected to have a negative effect on the budget.
All five bills received a "do pass" recommendation Thursday by House Rules Committee and move on to the full House.
Another bill that would eliminate the sales tax on groceries gradually is in a House subcommittee. Rep. Emily Virgin, D-Norman, is sponsoring the bill, which would reduce the 4.5% state sales tax on groceries by 1.5 percentage points each year until it is completely eliminated July 1, 2024.
A bill that would eliminate the sales tax on groceries is also in the Senate. Senate Bill 1494 would eliminate the sales tax on groceries by Nov. 1. It passed the Senate Appropriations Committee this week and goes to the full Senate.