Bill > HB1200

This bill modifies Oklahoma's tax laws, focusing on income tax rates and revenue certification processes. The legislation introduces new provisions for the State Board of Equalization to certify revenue estimates and tax growth, with specific focus on tracking tax collections that exceed $400 million. For individual income taxes, the bill establishes a new tax rate structure starting in tax year 2026, which includes a 0% tax rate for the first $3,750 for single filers (or $7,500 for joint filers), followed by graduated rates of 2.75%, 3.75%, and 4.7% for higher income brackets. The bill also creates a mechanism for automatic tax rate reductions if state revenue growth exceeds the $400 million threshold, with each certification potentially reducing marginal tax rates by 0.25 percentage points until rates potentially reach zero. The tax rate reductions are contingent on certain conditions, including maintaining a high federal medical assistance percentage for Medicaid expansion. Additionally, the bill makes technical updates to reference the Internal Revenue Code and adjusts various tax calculation methods. The legislation is set to become effective on November 1, 2025, impacting tax years beginning in 2026.

Budget and Finance

http://www.oklegislature.gov/BillInfo.aspx?Bill=hb1200&Session=2500