Oklahoma House Republicans are looking for ways to close an 8 million funding gap. They have proposed raising cigarette taxes by .50 per pack; based on that tariff increase exclusively, Oklahomans would need to purchase about 585.3 million packs.
However, the Republican majority needs votes from 26 Democrats, who said they would not support the cigarette tax. The Democrats, who make up the minority in the House, believe their resistance will give them more leverage in the budget battle.
House Minority Leader Scott Inman said, “We’ve said all along that a cigarette tax is just a Band-Aid on a bullet hole. You’ve got to have additional revenue.” Accordingly, Democrats have presented a plan they say would generate $400 million over the next year. The plan would allow tribes to offer non-house-banked table games, like roulette and craps, in exchange for 10 percent of their monthly net win. It also would legalize sports betting, if the current federal ban is repealed.
In addition, besides the cigarette tax, the Democrats’ proposal would place a $17,000 cap on itemized income tax deductions for citizens, restore the earned income tax credit and remove oil and gas production incentives.
But Republican lawmakers believe casinos already are too prevalent and gambling expansion would lead to negative societal problems. Senate President Pro Tem Mike Schulz said, “I think we have too much gambling going on in the state. I think we have people who are spending milk and bread money in a casino rather than taking care of their kids.” He added money spent at casinos isn’t spent on sales tax-generating purchases.
When an impasse was obvious, Inman said, “Apparently, Senate leadership, for a variety of reasons apparently, has decided to renege on the negotiations.” Schulz said he never agreed to a package, so he was not reneging. Additionally, Senate Majority Floor Leader Greg Treat said, “We’re sitting here on May 8, and this is the first we’ve heard of this deal. Leader Inman has continued to move the goal posts. We stand ready to pass the revenue to fill the hole, and we don’t need some gimmick of a last-minute gaming or gambling to get us there.”
Legislators are expected to hold special budget sessions to resolve their differences and create a budget. But Inman said he doubted lawmakers could complete their work by the May 26 deadline and avoid a special session. He noted it would cost an estimated $30,300 per day to reconvene in June. “We’ll see where it goes from here,” he said.
