REPUBLICANS working on tax reform plan

Thursday, November 8th 2001, 12:00 am
By: News On 6

OKLAHOMA CITY (AP) _ A tax reform package that eliminates the state income tax still could be sent to a vote of the people in the next few months, a spokesman for Gov. Frank Keating said Thursday.

John Cox, Keating's press secretary, also acknowledged that business interests are resisting the idea of a gross receipts tax to offset the $2.5 billion that would be lost from eliminating the state income tax.

Cox said a gross receipts tax, previously touted by Keating, had not been ruled out as an option. ``There's been some resistance to that,'' he said. ``That's why the governor is not going to talk specifics.

``Part of the process is to go and look at what will work and what will not work. If something is met with resistance, the governor will look at other things.''

He would not comment on a published report that Republican lawmakers are looking at ditching the gross receipts idea and substituting a plan that would expand the sales tax base to include services that are now exempt.

On Wednesday, Tom Daxon, state finance director, told The Daily Oklahoman that based on interviews with more than 60 business leaders and accountants, ``the gross receipts tax looks less and less likely to be something that will work'' in Oklahoma.

Rep. Clay Pope, D-Loyal, House Revenue and Tax Committee chairman, also said Democrats were hearing opposition to a gross receipts tax.

Keating and House and Senate leaders originally planned to hold a special session Sept. 25 to refer a tax plan to the people that would eliminate the income tax and sales tax on groceries.

But they later said more time was needed to analyze the impact of tax changes and a study by a group of university professors commissioned to come up with alternatives to the current state tax system.

The study by professors at the University of Oklahoma and Oklahoma State University grew out of a proposal by Sen. Stratton Taylor, D-Claremore, to adopt the tax system in Texas, which has no income tax or sales tax on groceries.

Cox said a new tax reform plan will probably be announced after Thanksgiving.

Pope said it might be best to delay action on a tax plan until the regular session next year, but Cox said Keating still has a goal to put it before a vote of the people as soon as possible.

``It's still his goal to pass it before the legislative session starts in February,'' he said.