Bill > HB1539

This bill modifies Oklahoma's individual income tax structure by introducing a new mechanism for potentially reducing income tax rates based on state revenue growth. Starting in 2024, the bill establishes a base income tax rate structure with lower rates compared to previous years, ranging from 0.25% to 4.75% depending on income level and filing status. The key innovation is a revenue-triggered tax rate reduction process where the State Board of Equalization will annually assess whether total state revenue collections have increased by at least $300 million compared to a base year (fiscal year ending June 30, 2023). If this revenue growth threshold is met, the income tax rates will automatically be reduced by 0.25% in the following calendar year. This process can continue until income tax rates potentially reach zero. The bill also maintains existing provisions for different tax rates for various filing statuses (single, married filing jointly, heads of households) and includes special provisions for nonresident aliens and other specific taxpayer categories. The new tax rate reduction mechanism is designed to provide tax relief contingent on demonstrable state revenue growth, creating a dynamic and responsive income tax system. The bill is set to become effective on November 1, 2025.

Budget and Finance

http://www.oklegislature.gov/BillInfo.aspx?Bill=hb1539&Session=2600