GOVERNOR wants to eliminate corporate income tax
Monday, August 13th 2001, 12:00 am
By: News On 6
OKLAHOMA CITY (AP) _ Gov. Frank Keating said he wants to eliminate Oklahoma's corporate income tax and business franchise tax.
The governor said he wants more tax cuts than are currently proposed as long as the revenue can be offset. Keating previously said he wants to abolish the personal income tax and sales tax on groceries.
The Republican governor is considering replacing the lost revenue with a gross receipts tax on producers of products and services.
``We hope this can be a move from income and investment tax to a consumption tax,'' he told The Daily Oklahoman.
The governor and legislative leaders have discussed abolishing the income tax and state sales tax on groceries, modifying the estate tax and still financing state government at current levels.
``Will it work where there is not an immediate dramatic shortfall in revenue that could imperil road construction and education, but at the same time show a long-term dramatic tax cut for the people of Oklahoma?'' Keating said.
``That's the idea. That's what we're trying to reach.''
Legislative leaders announced Friday they will meet in special session Sept. 7, but will not examine tax reform until a formal proposal has been developed.
They would like to tackle tax reform in a special session before the end of this year.
Senate leader Stratton Taylor said Thursday he would be willing to consider eliminating the franchise tax and corporate income tax.
The renewed interest in tax reform was triggered last spring when Keating, Taylor and House Speaker Larry Adair hired a team of University of Oklahoma and Oklahoma State University economists. The economists were to devise a revenue-neutral tax system that would eliminate the personal income tax and sales tax on groceries and change state estate tax rates.
The authors of the 78-page report said eliminating the income tax isn't the best way to improve Oklahoma's tax system.
Keating said levying a 1.4 percent gross receipts tax might be one way to eliminate the personal and corporate income taxes, the franchise tax, sales tax on groceries and revamp the estate tax. Keating said he would exempt farm and ranch operations from the tax.