Doerflinger: Falling Oil Prices May Hinder Income Tax Reduction
Oil revenue drop may block income tax reduction trigger
By Rick M. Green
In an indirect way, falling oil prices may delay implementation of a law to lower Oklahoma’s income tax.
The law requires growth in state revenue, which is provided in part by tax collections that rise and fall with the price of oil.
“It’s iffy at best as to whether we will see that growth,” Okla homa Secretary of Finance and Revenue Preston Doerflinger said Thursday in an interview with The Oklahoman.
Collections from the gross production tax on oil and natural gas dropped below prior year collections in November for the first time in 19 months, down by $3.72 million or 5.3 percent. However, this reflects production from September, when oil was $93 a barrel. It is now about $66, so tax collections are expected to drop further. Oil hit a peak of $106 in June.
“I hope that the falling oil and gas prices will be short-lived,” Gov. Mary Fallin said last week.