This bill amends Section 2355 of the Oklahoma Statutes to introduce a new individual income tax structure effective January 1, 2024, featuring reduced tax rates for both single individuals and married couples. The new rates start at 0.25% for the first $1,000 and increase incrementally, with a maximum rate of 4.75% on income exceeding certain thresholds. Additionally, the bill establishes a mechanism for further tax rate reductions based on revenue growth, defined as an increase of at least $300 million in total revenue collections compared to a base year. For taxable years beginning on or after January 1, 2026, the income tax rates may be reduced by 0.0025 for each qualifying year. The bill also lowers the tax rate for nonresident aliens from 30% to 8% and sets a corporate tax rate of 4% for businesses operating in Oklahoma.

Moreover, the bill modifies the withholding and reporting requirements for taxes, mandating that payers provide a written statement to payees by January 31 of the following year, detailing the amounts paid and withheld. It also aligns the tax rates for trusts and estates with those for single individuals and updates the tax rate tables for individuals. The term "ceiling amount" is defined for tax rate categories, and the act is scheduled to take effect on November 1, 2025. Overall, the legislation aims to reduce tax burdens while ensuring compliance and accountability in tax reporting.

Statutes affected:
Introduced: 68-2355