Ask yourself, is there a tax break that benefits the rich that is so overwhelmingly stupid that even the Oklahoma legislature would repeal it? Believe it or not, the answer is yes.
Last week, the Oklahoma legislature sent Gov. Mary Fallin a bill—at her request—eliminating just such a break: a state income tax deduction for state income taxes paid. Oddly enough, Oklahoma taxpayers who happen to claim itemized deductions can currently write off their state income tax payments when calculating how much state income tax they owe. This bizarre, circular deduction did not come into existence because of its policy merits (there are none), but rather because Oklahoma accidentally inherited it when lawmakers chose to offer the same package of itemized deductions made available at the federal level.
via Tax Justice Blog
Congratulations to Oklahoma, I guess, for sacrificing it’s whack job conservative principles on this one occasion. According to the article there are other states that have the same deduction as Oklahoma, which are apparently taking no steps to end it.
Actually, Oklahoma is not really sacrificing much by way of principle. The Republican governor and legislature, after years of cutting taxes on the rich, have suddenly found, to their (but nobody else’s) surprise, that they can’t meet state expenses. This particular break is so absurd that it was low hanging fruit, but it probably would have stayed put if the hole they dug themselves into wasn’t quite so deep.
Still, while one can see how the mistake leading to this deduction could have been made in Oklahoma and other states, it’s a mystery how any state could let it stay put once anyone pointed it out. Well, maybe not that much of a mystery:
Making matters worse, these purposeless tax breaks actually exacerbate the unfairness built into state and local tax systems. According to an ITEP analysis, over half (58 percent) of the revenue lost through Oklahoma’s deduction flows to just the wealthiest 5 percent of taxpayers
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