Taylor proposes copying Texas tax system

Monday, March 26th 2001, 12:00 am
By: News On 6

OKLAHOMA CITY (AP) _ Oklahomans would pay no income taxes nor sales taxes on groceries under a proposal announced Monday by Senate President Pro Tempore Stratton Taylor.

Taylor, D-Claremore, called for junking Oklahoma's tax system and replacing it with Texas' system, which has no income tax, either individual or corporate, nor a sales tax on groceries.

``Instead of trimming around the edges of our tax system, we need to consider a much bolder approach,'' Taylor said. ``We've heard a lot of talk about how much more business and people friendly the Texas tax system is.

``I think we owe it to voters to give them an opportunity to decide whether it's right for them. I'm sure Oklahomans would jump at the chance to eliminate the income tax and sales tax on groceries.''

Taylor said he was serious about adopting his ``Texas Plan,'' which would require a statewide vote on a series of constitutional amendments.

Gov. Frank Keating, a Republican, wants to cut the state income tax from 6.75 percent to 3.75 percent over six years. The reduction the first year would cost $53 million.

Republicans also have proposed eliminating the grocery tax, a $190 million tax cut.

John Cox, Keating's press secretary, said the governor had no immediate comment on Taylor's plan.

But Sen. Jim Dunlap, R-Bartlesville, Senate minority leader, said he was ``not a supporter of doing the Texas tax package here in Oklahoma.''

For one thing, he said Texas has higher property taxes than Oklahoma.

Taylor said he is asking academic leaders at the University of Oklahoma and Oklahoma State University to research how to duplicate the Texas system. Their study would focus on the two states' respective tax codes, including personal and corporate income tax, sales taxes and exemptions, property taxes, estate taxes, franchise taxes and other business taxes.

``By turning the project over to the universities, we can take politics out of the mix and examine the proposal on its merits alone,'' he said.

Dunlap said a study would be all right, but he was concerned that ``all we would be doing is delaying tax relief that is due Oklahoma taxpayers.'' He said he preferred going ahead with the current GOP income tax-cut plan.

Taylor mentioned Texas, Florida, Washington and Tennessee as states that do not have an income tax and that have outpaced Oklahoma in economic growth.

Keating and other tax-cut proponents have cited Texas' strong economic growth in calling for reducing income and sales taxes.

Taylor said there is merit in their argument, but a piecemeal approach to tax cuts will not work.

``I think it's important to consider the Texas tax code in its entirety,'' he said. ``If we don't consider a uniform adoption of every aspect of the Texas system, we might miss out on some potential benefits for Oklahoma.''

He said he is optimistic OU and OSU can do the necessary research and draft a proposal in time for the Legislature to consider the issue before it adjourns on May 25. That would allow the proposed constitutional amendments to be placed on a special election ballot this year.