This bill amends various sections of Oklahoma tax law, focusing on exemptions from gross production tax, modifications to income tax rates, and limitations on tax credits and deductions. It establishes that exemptions for economically at-risk oil or gas leases will be limited to production from calendar years 2022 through 2024, with a cap on total refunds for oil and natural gas produced from qualifying leases during these years. Claims for refunds must be filed by specific deadlines, and the Oklahoma Tax Commission will not accept claims filed after the act's effective date. Additionally, the bill revises the income tax structure for individuals, introducing new tax rates for 2024 and 2025, which include a gradual reduction in tax percentages for different income brackets, while eliminating the deduction for federal income taxes paid.

The bill also introduces a withholding tax rate of eight percent for certain amounts and modifies the tax rate for corporations and foreign corporations to four percent on Oklahoma taxable income for taxable years beginning after December 31, 2021. It extends eligibility for credits related to investments in qualified depreciable property and net increases in full-time-equivalent employees in manufacturing operations through 2024. Furthermore, the bill clarifies the calculation of taxable income and adjusted gross income for corporations and individuals, including adjustments for interest income and federal net operating loss deductions. Overall, the amendments aim to reduce the tax burden on Oklahoma taxpayers while ensuring compliance with current federal tax law and updating definitions within the tax code.

Statutes affected:
Introduced: 68-1001.3a, 68-2355, 68-2358