Oklahoma Senate Tells House to Add Gross Production Tax to Budget Deal

Oct 26, 2017

Credit Matt Trotter / KWGS

The Oklahoma Senate told the House Thursday enough is enough — it’s time to pass a special session budget deal, and that means an increase in the gross production tax.

State senators approved a resolution by voice vote telling the House not only to pass a budget deal as soon as possible, but also what to put in it. The resolution calls for a $1.50 per pack cigarette tax, a new tax on other tobacco products, a 6 cent fuel tax increase, a higher tax on low-point beer and a 4 percent tax on new oil and gas wells.

"Adding GPT to the budget deal certainly wasn’t my first choice, but if it breaks the stalemate it is an option we have to pursue," Senate President Pro Tem Mike Schulz said in a statement. "We now have an opportunity to deliver on teacher pay raises, stop massive budget cuts to health care and eliminate the constant budget problems plaguing our state."

The Senate's action comes a day after a budget plan announced by Republican leaders on Monday failed in the House. It fell short of the required three-fourths majority largely because Democrats opposed it without an increase in the gross production tax.

House Majority Floor Leader Jon Echols told Democrats he would hold a separate floor vote on a 5 percent gross production tax if they supported that budget plan.

The Senate resolution passed Thursday was authored by Schulz, Majority Floor Leader Greg Treat and Minority Floor Leader John Sparks.

"This is the time for leadership, real compromise and a long-term plan of action for Oklahoma and its people. We are committed to working together with the Governor and Senate and House leadership toward a resolution that benefits all Oklahomans," Sparks said in a statement.

"On our side, we have bipartisan support for this package, and we very much appreciate the Democrats' support in the Senate," Treat said.

The Senate resolution tells the House to pass budget plan it describes at the earliest possible time and to pass other legislation needed to give teachers a $3,000 raise, give state employees a $1,000 raise and restore the Earned Income Tax Credit.

The state constitution calls for revenue bills to originate in the House. This proposal will still need three-fourths majorities, and Treat says lawmakers should plan to be at the capitol this weekend.

The Senate plan calls for a 4 percent gross production tax for 36 months. Rep. Eric Proctor said House Democrats are standing firm at offers of 5 percent for 36 months, 4.5 percent for 18 months or 4 percent for 12 months.