Senate Budget Fix Includes Gas Tax Hike and Elimination of Sales Tax Exemption for Wind Industry

An increase in Oklahoma’s motor fuels tax is part of the State Senate budget plan released this week by President Pro Tempore Senator Mike Schulz. The plan also includes total elimination of sales tax exemptions for the wind industry.

“This plan not only addresses the immediate need of $215 million for critical health care agencies that was struck down in court, but it also provides recurring revenue streams to help us address the long-term stability of the budget and prevent further cuts to core government services,” said the Republican Senator from Altus.

The GOP plan includes a six-cent jump in motor fuels taxes, a move that Schulz maintains will generate $7 million in Fiscal year 2018. He said it will also leave $67.45 million for FY 2018 appropriation.

The plan calls for elimination of the wind manufacturer sales tax exemption which generates $10.97 million in FY 18 and leaves $9.87 million for FY 18 appropriation.

But Republicans in the Senate also want a $1.50 a pack hike in the cigarette tax. Such a jump would raise $128.9 million for the 2018 Fiscal Year and leave $122.4 million for FY 2018 appropriation.

“The elements of this plan for special session were fully vetted by the Senate during the regular session and all received the necessary votes to pass constitutional muster,” added Sen. Schulz.

He said while the governor’s call for the special legislative session included a teacher pay raise, Sen. Schulz made it clear the immediate need is addressing the Fiscal Year 2018 budget hole.

“Senate Republicans have said all along we must first address the short-term budget issues before acting on a teacher pay raise plan,” he said. “Once we take care of the budget, Senate Republicans would consider a teacher pay plan that includes a permanent funding source.”