OCPA column: A Better Plan

A Better Plan

by OCPA President Jonathan Small

It’s easy for insiders to support tax increases–much easier than it is for low- and middle-income families and small businesses to pay higher taxes.

That’s why the Oklahoma Council of Public Affairs has offered a revenue and reform plan. Our plan even received the endorsement of former U.S. Sen. Tom Coburn.

What’s missing from our plan? A messy income tax hike on those who can’t afford it. Included is the same $5,000 teacher pay raise that big government advocates keep using for their bait-and-switch games. It’s time to give teachers the pay raises they deserve and stop the rest of the bureaucracy from using teachers as pawns while state agencies refuse to reform.

“It’s time for the circus to end,” Sen. Coburn said, noting that “teachers, the most vulnerable, working Oklahomans, and small businesses are being held captive and will suffer damaging tax increases that will harm families and ruin future efforts for pro-growth tax reform.”

Our alternative plan would set gross production taxes to 5 percent on new wells for 36 months. It would increase cigarette taxes by 75 cents a pack. Wind tax credits would be capped at $10 million. Voters would be asked to approve shifting new settlement payments from the Tobacco Settlement Endowment Trust to the state’s Medicaid program, surely a worthy way to spend money earmarked for health. And, the Indian tribes would be asked to forgo $67 million in rebates on tobacco sales since they are also citizens of Oklahoma.

Those measures would pump $505.4 million into the state treasury to fund a $5,000 teacher pay raise. They wouldn’t make the tax code more complex or make revenue promises that are unlikely to materialize. And, they avoid burdening most families and working Oklahomans with more taxes.

If lawmakers are dead set on raising taxes, at least they should do it in the least damaging way. The more challenging but vital work remains: reforming and restructuring state government to prevent this annual exercise in panic budgeting from ever happening again.

We could start with rigorous audits of every state agency, questioning outcomes rather than just accounting for inputs, and by passing some real reforms like work requirements for able-bodied Medicaid recipients and allowing schools to use local revenues for top priorities like teacher pay. We should also end Oklahoma's Hollywood film handout that paid millions to Harvey Weinstein.

As Sen. Coburn said, “It’s time for politicians to do their number one job, which is tough and accountable oversight.”

Jonathan Small serves as president of the Oklahoma Council of Public Affairs.