Higher tax rates boost September revenue
BY DALE DENWALT Capitol Bureau ddenwalt@oklahoman.com
A recent change in the tax rate on oil and gas production helped lift September collections well past the same month last year.
Oklahoma brought in $1 billion last month, which is $72.4 million or 7.7 percent higher than September 2016. During their last regular session, lawmakers raised the tax rate on older wells. Doing so boosted revenue by nearly $7 million.
As lawmakers negotiate during special session, one of the items on the table is another gross production tax increase. However, leaders in the House, Senate and governor’s office haven’t settled on a percentage or how broad an increase might be sought.
Legislators also implemented a new 1.25 percent tax on motor vehicle sales; the change brought in $11.1 million, according to Treasurer Ken Miller.
Overall, tax changes made this year accounted for more than $23 million in September revenue. Those changes also include the elimination of a discount offered to businesses that collect sales tax, a higher fee on motor vehicle registrations and elimination of gross production tax rebate payments.
Since August, the law changes have yielded $40.5 million in new gross revenue.
In his monthly report on state collections, Miller also attributed much of the revenue gains to a strengthening economy.
“Economic momentum in the state is going up,” Miller said. “In September, gross receipts show increased income and consumption, attributable at least in part to increased oil-field activity during the past several months.”
Miller’s report comes out before the finance secretary’s report on general revenue fund collections. While the treasurer’s gross receipts analysis shows the overall status of Oklahoma’s economy, the general revenue fund report indicates how much money can be spent on government programs.
Each year, lawmakers appropriate much of the state budget from the general revenue fund. If collections are less than expected for several consecutive months, it could predict another revenue failure and mandatory spending cuts.