Democratic candidate for governor Drew Edmondson wants to raise taxes in Oklahoma and that includes returning the state’s gross production tax on oil and gas to 7 percent.
In announcing his plan during a state capitol news conference with former OU President David Boren at his side, the former state attorney general also said he would consider calling for a state question to carry out the energy tax plan if the legislature won’t go along with him—-if he is elected governor.
In the 2018 legislature, the gross production tax on new wells was raised from 2 percent to 5 percent. Edmondson wants that rate boosted to 7 percent, the amount that producers pay on wells after three years of production.
“I’m asking them to put it on back where it was at 7 percent. That’s not going to be an easy sell, and it may not happen right away,” he said. “If the Legislature opts not to do that and I can’t convince them to do it, I’m going to see to it that it’s on the ballot and give the voters an opportunity to say where the gross production tax ought to be. And I think the voters will pass it.”
Edmondson said he intends to use the additional revenue for education. He also wants to increase the cigarette tax by 50 cents a pack and eliminate the capital gains tax deduction. He estimated during the news conference that his three tax proposals would raise $300 million a year.
Boren, the former U.S. Senator and governor endorsed Edmondson in taking a stand against the oil and gas industry and others.
“We can’t afford to take a chance in this year’s governor’s race,” said Boren. “There’s no margin for error. We need to elect someone who has a proven track record for standing up to special interests and getting the right things done for Oklahoma.”
But Edmondson also admitted that it would be difficult to increase the gross production tax. As for the other taxes?
“The cigarette tax, the additional 50 cents, has already passed once; it just didn’t get the 75 percent ,” Edmondson said. “We’re going to have a new Legislature in 2019 and if you looked at the results of those runoff elections, six out of seven incumbent Republicans who voted against the revenue measure were defeated by other Republicans.”
His plan drew criticism from Republican candidate for governor Kevin Stitt.
“Over the past year, our state revenue has grown by more than $1 billion, and our economy is making a comeback. In the next few weeks, we will also begin to see the impact from tax increases passed earlier this year,” Stitt said in a statement posted on his website. “Yet, my opponent is already calling for even more taxes on hardworking Oklahomans. In a Stitt administration, we will make it a priority to invest more in education, but it starts by assessing new state revenue at hand, diversifying our economy, and delivering accountability across our state budget.”