Stitt uses new Oklahoma budget figures to bolster his case for tax cut

OKLAHOMA CITY – Gov. Kevin Stitt on Friday used new budget figures to attempt to bolster arguments for an income tax cut.

“We need that to happen this year,” Stitt said.

Lawmakers will have nearly $12.4 billion to spend on the fiscal year 2026 budget, according to figures released Friday by the Board of Equalization. 

That figure is up slightly from December, when the Board of Equalization indicated the state would have nearly $12.3 billion.

The increase is attributed to a growth in revenue from the state’s taxes on personal income and oil and gas revenue.

Lawmakers in fiscal year 2025 appropriated about $12.5 billion.

Oklahoma has $4.6 billion in reserves and unspent revenue with another $350 million available in June, Stitt said.

Stitt wants to cut the state’s 4.75% personal income tax by .5%. It would cost $240 million for a half year and $600 million for a full year, Stitt said.

He said the $600 million wouldn’t be lost revenue because it would be put back into the economy. 

“It’s not like I’m cutting $240 million,” Stitt said. “I’m just leaving it in their pockets, right? So, it gets spent at the grocery store. It gets spent at the gas station. It gets spent at the bicycle shop.”

He also is not advocating for using the state’s reserves to pay for it.

States that cut their taxes saw revenue increase, Stitt said.

“We need more taxpayers, not more taxes,” Stitt said. “I need more people moving to Oklahoma. That is good for our state.”

Some legislative leaders on both sides of the aisle have expressed concern that cutting the income tax would put the state in a precarious position should there be another economic downturn. It takes a super majority in both chambers or a vote of the people to raise taxes.

“I’m not threatening vetoing budgets, but you know, everything is on the table because I am adamant,” Stitt said. I’ve called three special sessions for tax cuts.”

In December, the Board of Equalization indicated the state would have about $191 million less to spend than the current budget year due in part to the state’s elimination of its 4.5% sales tax on groceries.

State Treasurer Todd Russ, a Board of Equalization member, said the state has largely recovered from the lost revenue.

Oklahoma Attorney General Gentner Drummond, a member of the Board of Equalization, did not attend the meeting, saying he didn’t trust the figures.

“Last December, we were told one amount, then two months later it was a new number that magically was enough to help pay for the Governor’s tax cut,” said Drummond, who is running to become Oklahoma’s next governor when Stitt terms out in 2026.

The Office of Management and Enterprise Services said the figures and estimates were provided by the Oklahoma Tax Commission and outside economists.

State Superintendent Ryan Walters, a member, also did not attend.

Stitt has been critical of Walters, accusing him of picking on kids for a proposal to require students to provide their immigration status and for low test scores.