Individual Income Tax Rates [1] | Marginal Tax Rate | Single /
Married Filling Separately | Married Filing Jointly /
Qualifying Widow(er)s /
Heads of Households |
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| 0.25% | $0 – $1,000 | $0 – $2,000 |
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| 0.75% | $1,000.01 – $2,500 | $2,000.01 - $5,000 |
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| 1.75% | $2,500.01 – $3,750 | $5,000.01 - $7,500 |
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| 2.75% | $3,750.01 - $4,900 | $7,500.01 - $9,800 |
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| 3.75% | $4,900.01 - $7,200 | $9,800.01 - $12,200 |
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| 4.75% | $7,200.01 + | $12,200.01 + |
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CorporationsThe corporate income tax rate is a flat tax of 4% for all corporations, regardless of earnings. When established in 1931, the corporate income tax was progressive but became flat in 1935. Revenue PurposeBoth individual and corporate income taxes are earmarked by the Oklahoma Legislature to support specific state agencies and/or funds: Individual and Corporate Income Taxes| Purpose | Individual-Percentage Received | Corporate-Percentage Received |
|---|
| General Revenue | 85.66% | 77.5% |
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| Education Reform Fund | 8.34% | 16.5% |
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| Teachers' Retirement Fund | 5% | 5% |
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| Ad Valorem Reimbursement Fund | 1% | 1% |
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Sales and Use TaxThe State sales tax and use tax was first enacted in 1933 as a temporary one percent tax for the support of public schools. Two years later, the tax was renewed with revenues being deposited into the state General Fund. In 1939, the sales tax rate was increased to two percent with the revenues being used to fund public assistance programs. This remained unchanged until the 1980s when the revenues were redirected back to the General Fund. Additionally, throughout the 1980s, the tax rate was gradually increased from two percent to four percent. In 1990, the passage of the "Education Reform Act" increased the State sales tax rate to its present four and a half percent. State sales taxes are now the second largest source of revenue for the State government, accounting for approximately 27% of total state revenue. Tax RateThe "Oklahoma Sales Tax Code" imposes a 4.5% Statewide tax on the sale of all goods but groceries within the State. The State also levies a 4.5% Statewide tax on the use, storage, and consumption of goods bought out of State. Revenue PurposeBoth the State sales and use taxes are earmarked by the Oklahoma Legislature to support specific state agencies and/or funds: State Sales and Use Taxes [2] | Purpose | Percentage Received |
|---|
| General Revenue | 83.61% |
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| Education Reform Fund | 10.46% |
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| Teachers' Retirement Fund | 5% |
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| Tourism Fund | 0.87% |
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| Historical Society Fund | 0.06% |
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Gross Production TaxThe State levies a gross production tax on the removal of natural products from Oklahoma's land or water. The gross production tax was established in 1910 to tax the extraction of natural gas and oil. With the elimination of State-level property taxation, the gross production tax began an important source of State revenue. The current State gross production tax takes the form of an excise tax, with the amount of the tax based upon the sale price of oil and natural gas. Gross Production taxes are the fourth largest source of revenue for the State government, accounting for approximately 6% of total state revenue. Tax RatesOklahoma state law has imposed several taxes on the removal of natural resources of the State: Gross Production and Excise Taxes on Natural Resources [3] [4] | Resource | Tax Imposed |
|---|
| Asphalt, Lead, Uranium, Zinc, Gold, Silver, and Copper | 0.75% |
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| Oil | 7% |
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| Natural Gas | 7% |
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| Petroleum Oil Excise | 0.95% |
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| Natural Gas Excise | 0.95% |
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Revenue PurposeThe Oklahoma Legislature has earmarked the revenues from the gross production and petroleum excise tax to support various agencies and/or funds: Gross Production and Excise Taxes on Natural Resources [5] | Purpose | Ores and Precious Metals | Oil | Natural Gas | Petroleum Gas Excise | Natural Gas Excise |
|---|
| General Revenue | 85.72% | | 85.72 | 82.634% | 82.634% |
|---|
| County Highway Funds | 7.14% | 7.14% | 7.14% | | |
|---|
| Local School Districts | 7.14% | 7.14% | 7.14% | | |
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| Common Education Technology Fund | | 25.72% | | | |
|---|
| Higher Education Capital Fund | | 25.72% | | | |
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| Oklahoma Tuition Scholarship Fund | | 25.72% | | | |
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| County Bridge and Road Improvement Fund | | 3.745% | | | |
|---|
| Tourism Capital Fund | | 1.427% | | | |
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| Conservation Commission Infrastructure Fund | | 1.427% | | | |
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| Community Water Infrastructure Development Fund | | 1.427% | | | |
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| Statewide Circuit Engineering District Fund | | 0.535% | | | |
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| Corporation Commission Plugging Fund | | | | 10.526% | 10.526 |
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| Interstate Oil Compact Fund | | | | 6.84% | 6.84% |
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Motor Vehicle TaxesThe modern excise tax on motor vehicles was established in 2000. The motor vehicle tax assesses a three and one quarter percent tax on the sale price of all vehicles in the State, new and used. Taxes are collected by local motor license agents (or tag agents) under the supervision of the Tax Commission. State motor vehicle excise taxes are the third largest source of revenue for the State government, accounting for approximately 7% of total state revenue. Tax RatesOklahoma state law has imposed several taxes on motor vehicles of the State: Vehicle Taxes and Licenses| Source | Tax Imposed |
|---|
| Aircraft Excise Tax | 3.25% |
|---|
| New Motor Vehicle Tax | 3.25% Excise Tax + 1.25% Sales Tax |
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| Used Motor Vehicle Excise Tax | $20 on first $1,500 + 3.25% on remainder + 1.25% Sales Tax on Total |
|---|
| Motor Vehicle Registration Fee | Vehicle Age Years 1-4: $91/annually
Vehicle Age Years 5-8: $81/annually
Vehicle Age Years 9-12: $61/annually
Vehicle Age Years 13-16: $41/annually
Vehicle Age Years 17+: $21/annually |
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| Motor Vehicle Rental Tax | 6% |
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| Overweight Vehicle Fee | $40 per permit + $10 per thousand pounds above the limit |
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| New and Used Motor Boat Excise Tax | 3.25% |
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| Motor Boat Registration Fee | Boat Age Years 1: $2.25 + $1.00 for every $100.00 of sale price
Boat Age Years 2-10: $2.25 + 90% of previous year's fee
Boat Age Years 11+: $2.25 + 90% of tenth year's fee |
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Revenue PurposeThe Oklahoma Legislature has provided that the excise tax on motor vehicles and boats and the registration fees for motor vehicles and boats are to be apportioned as follows: Vehicle Taxes and Fees [6] | Purpose | Motor Vehicle and Boat Taxes and Fees |
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| Local School Districts | 36.2% |
|---|
| General Revenue | 29.84% |
|---|
| State Transportation Fund | 0.31% |
|---|
| Local County Governments | 8.07% |
|---|
| County Highway Funds | 6.21% |
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| Local City Governments | 3.1% |
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| Law Enforcement Retirement Fund | 1.24% |
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| Wildlife Conservation Fund | 0.03% |
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| County Improvements for Roads and Bridges Fund | 15% |
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All revenues generated from the Aircraft Excise Tax are directed towards the Aeronautics Commission Fund, which supports the operations of the Oklahoma Aeronautics Commission. The Oversized Vehicle Fees are apportioned in the same manner as the motor vehicle taxes and fees on the first $1,216,000 collected each month. Any revenues collected in excess of that amount are deposited into the Weigh Station Improvement Fund, which is used to maintain and expand the State's Weigh stations. Motor Fuel TaxesIn 1923, Oklahoma enacted its first State-level excise tax on motor fuels. The motor vehicle tax has since its enactment been the primary funding mechanize used for the construction and maintenance of State roads and bridges. Prior to the enactment of the fuel tax, the State played a limited role in building the State's transportation infrastructure, primarily overseeing the work conducted by local governments. The current motor fuel taxes are a set amount based upon the amount of fuel purchased and not a percentage of the sale price. The fuel taxes continue to be the State's primary source of funding for infrastructure spending, with a significant portion of the revenues being forwarded to local level government. State motor fuel taxes account for approximately 5% of total state revenue. Tax RatesOklahoma state law levies taxes on both gasoline and diesel motor fuels: Motor Fuel Taxes [7] | Source | Tax Imposed |
|---|
| Gasoline Tax | $0.19/gallon |
|---|
| Diesel Tax | $0.19/gallon |
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| Motor Fuel Special Assessment Fee | $0.01/gallon on both gasoline and diesel fuels |
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| Compressed Natural Gas Tax | $0.05/gasoline gallon equivalent |
|---|
| Liquefied Natural Gas Tax | $0.05/diesel gallon equivalent |
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| Aircraft Fuel Tax | $0.0008/gallon |
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Revenue PurposeOklahoma state law levies taxes on both gasoline and diesel motor fuels: Motor Fuel Taxes Taxes [8] [9] [10] | Purpose | Gasoline Tax | Diesel Tax | Motor Fuel Fee | Aircraft Fuel Tax |
|---|
| State Transportation Fund | First $250,000 collected monthly | First $83,333.33 collected monthly | | |
|---|
| High Priority State Bridge Fund | 1.625% | 1.39% | | |
|---|
| State Transportation Fund | 63.75% | 64.34% | | |
|---|
| Local County Governments | 30.125% | 26.58% | | |
|---|
| Local County Highway Funds | | 3.85% | | |
|---|
| County Bridge and Road Improvement Fund | 2.297% | 3.36% | | |
|---|
| Local City Governments | 1.875% | | | |
|---|
| Statewide Circuit Engineering District Fund | 0.328% | 0.48% | | |
|---|
| Corporation Commission Fund | | | First $1,000,000 collected monthly | |
|---|
| Department of Environmental Quality Fund | | | 8% | |
|---|
| Petroleum Storage Tank Indemnity Fund | | | 92% | |
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| Aeronautics Commission Fund | | | | 100% |
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Tobacco TaxesThe State levies taxes on cigarettes and other tobacco products. The State levies an excise tax on cigarettes, as well as various excise taxes on cigars and smoking and chewing tobacco. As Oklahoma is home to numerous Native American tribes, the State has entered into state-tribal tobacco compacts under which the tribes remit taxes to the State derived from the sale of tobacco products on Indian land. State taxes on tobacco products account for approximately 4% of total state revenue. Tax RatesOklahoma state law levies taxes on cigarettes as well as various other tobacco products: Tobacco Taxes| Source | Tax Imposed |
|---|
| Cigarette Tax | $1.03/pack of 20 |
|---|
| Cigarette License Tax | $30 for 3 year permit for retailers $250 for 1 year permit for wholesalers
$100 for 1 year permit for distributors |
|---|
| Tobacco Products Tax | Little Cigars - $0.72/pack of 20 Large Cigar Tax - $0.12/each
Smoking Tobacco - 80% of factory list price
Chewing Tobacco - 60% of factory list price |
|---|
| Tobacco License Tax | $30 for 3 year permit for retailers $250 for 1 year permit for wholesalers
$100 for 1 year permit for distributors |
|---|
Revenue PurposesCigarette Taxes [11] | Purpose | Percentage Received |
|---|
| Health Employee and Economy Improvement Fund | 22.06% |
|---|
| Comprehensive Cancer Center Debt Service Fund | 3.09% |
|---|
| Trauma Care Assistance Revolving Fund | 7.5% |
|---|
| OSU College of Osteopathic Medicine Fund | 3.09% |
|---|
| Health Care Authority Medicaid Program Fund | 26.38% |
|---|
| Mental Health and Substance Abuse Services Fund | 2.65% |
|---|
| Breast and Cervical Cancer Treatment Fund | 0.44% |
|---|
| Teachers' Retirement System Revolving Fund | 1% |
|---|
| Education Reform Fund | 2.07% |
|---|
| Tobacco Prevention and Cessation Fund | 0.66% |
|---|
| General Fund | 16.83% |
|---|
| County and City Governments | 14.23% |
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Insurance TaxOklahoma assesses a State level excise tax on insurance premiums paid across the State. The insurance tax is collected by the Oklahoma Insurance Department. While most of the insurance tax is deposited within the General Fund, the revenues also support the Insurance Department and provide revenues for the State's employee retirement systems. Insurance premium taxes account for approximately 2% of total state revenue. Tax RateInsurance Tax [12] | Source | Tax Imposed |
|---|
| Insurance Premiums | 2.25% |
|---|
Revenue PurposeRevenues from insurance premium taxes are earmarked by the Oklahoma Legislature to support specific state agencies and/or funds. More than half of the revenues collected are used to support the State's public employee retirement funds, with the remainder allocated to the General Fund. Insurance Tax [13] | Purpose | Percentage Received |
|---|
| Firefighter Pension and Retirement Fund | First $812,500 collected and 36% of remainder | | Police Pension and Retirement Fund | First $325,000 collected and 14% of remainder | | Law Enforcement Retirement Fund | First $112,500 collected and 5% of remainder | | General Fund | Remaining 45% | Alcohol TaxesOklahoma has enacted a number of taxes on alcoholic beverages. The alcoholic beverage tax on liquor is an excise tax varying in amount depending on the alcohol by volume of the drink and an excise tax of $11.25 on each barrel of low-alcohol beer sold. A special sales tax of 13.5% is levied on the sale of all mixed drinks. State taxes on alcoholic beverage products account for approximately 1% of total state revenue. Related Research ArticlesA tax is a compulsory financial charge or some other type of levy imposed on a taxpayer by a governmental organization in order to collectively fund government spending, public expenditures, or as a way to regulate and reduce negative externalities. Tax compliance refers to policy actions and individual behaviour aimed at ensuring that taxpayers are paying the right amount of tax at the right time and securing the correct tax allowances and tax relief. The first known taxation took place in Ancient Egypt around 3000–2800 BC. Taxes consist of direct or indirect taxes and may be paid in money or as its labor equivalent.  The United States has separate federal, state, and local governments with taxes imposed at each of these levels. Taxes are levied on income, payroll, property, sales, capital gains, dividends, imports, estates and gifts, as well as various fees. In 2020, taxes collected by federal, state, and local governments amounted to 25.5% of GDP, below the OECD average of 33.5% of GDP.  In the United Kingdom, taxation may involve payments to at least three different levels of government: central government, devolved governments and local government. Central government revenues come primarily from income tax, National Insurance contributions, value added tax, corporation tax and fuel duty. Local government revenues come primarily from grants from central government funds, business rates in England, Council Tax and increasingly from fees and charges such as those for on-street parking. In the fiscal year 2014–15, total government revenue was forecast to be £648 billion, or 37.7 per cent of GDP, with net taxes and National Insurance contributions standing at £606 billion. Although the actual definitions vary between jurisdictions, in general, a direct tax or income tax is a tax imposed upon a person or property as distinct from a tax imposed upon a transaction, which is described as an indirect tax. There is a distinction between direct and indirect tax depending on whether the tax payer is the actual taxpayer or if the amount of tax is supported by a third party, usually a client. The term may be used in economic and political analyses, but does not itself have any legal implications. However, in the United States, the term has special constitutional significance because of a provision in the U.S. Constitution that any direct taxes imposed by the national government be apportioned among the states on the basis of population. In the European Union direct taxation remains the sole responsibility of member states.  In addition to federal income tax collected by the United States, most individual U.S. states collect a state income tax. Some local governments also impose an income tax, often based on state income tax calculations. Forty-two states and many localities in the United States impose an income tax on individuals. Eight states impose no state income tax, and a ninth, New Hampshire, imposes an individual income tax on dividends and interest income but not other forms of income. Forty-seven states and many localities impose a tax on the income of corporations.  Tax revenue is the income that is collected by governments through taxation. Taxation is the primary source of government revenue. Revenue may be extracted from sources such as individuals, public enterprises, trade, royalties on natural resources and/or foreign aid. An inefficient collection of taxes is greater in countries characterized by poverty, a large agricultural sector and large amounts of foreign aid.  The United States federal government and most state governments impose an income tax. They are determined by applying a tax rate, which may increase as income increases, to taxable income, which is the total income less allowable deductions. Income is broadly defined. Individuals and corporations are directly taxable, and estates and trusts may be taxable on undistributed income. Partnerships are not taxed, but their partners are taxed on their shares of partnership income. Residents and citizens are taxed on worldwide income, while nonresidents are taxed only on income within the jurisdiction. Several types of credits reduce tax, and some types of credits may exceed tax before credits. Most business expenses are deductible. Individuals may deduct certain personal expenses, including home mortgage interest, state taxes, contributions to charity, and some other items. Some deductions are subject to limits, and an Alternative Minimum Tax (AMT) applies at the federal and some state levels. Income taxes in Canada constitute the majority of the annual revenues of the Government of Canada, and of the governments of the Provinces of Canada. In the fiscal year ending March 31, 2018, the federal government collected just over three times more revenue from personal income taxes than it did from corporate income taxes. Income taxes are the most significant form of taxation in Australia, and collected by the federal government through the Australian Taxation Office. Australian GST revenue is collected by the Federal government, and then paid to the states under a distribution formula determined by the Commonwealth Grants Commission. Tax policy refers to the guidelines and principles established by a government for the imposition and collection of taxes. It encompasses both microeconomic and macroeconomic aspects, with the former focusing on issues of fairness and efficiency in tax collection, and the latter focusing on the overall quantity of taxes to be collected and its impact on economic activity. The tax framework of a country is considered a crucial instrument for influencing the country's economy. Optimal tax theory or the theory of optimal taxation is the study of designing and implementing a tax that maximises a social welfare function subject to economic constraints. The social welfare function used is typically a function of individuals' utilities, most commonly some form of utilitarian function, so the tax system is chosen to maximise the aggregate of individual utilities. Tax revenue is required to fund the provision of public goods and other government services, as well as for redistribution from rich to poor individuals. However, most taxes distort individual behavior, because the activity that is taxed becomes relatively less desirable; for instance, taxes on labour income reduce the incentive to work. The optimization problem involves minimizing the distortions caused by taxation, while achieving desired levels of redistribution and revenue. Some taxes are thought to be less distorting, such as lump-sum taxes and Pigouvian taxes, where the market consumption of a good is inefficient, and a tax brings consumption closer to the efficient level. The history of taxation in the United States begins with the colonial protest against British taxation policy in the 1760s, leading to the American Revolution. The independent nation collected taxes on imports ("tariffs"), whiskey, and on glass windows. States and localities collected poll taxes on voters and property taxes on land and commercial buildings. In addition, there were the state and federal excise taxes. State and federal inheritance taxes began after 1900, while the states began collecting sales taxes in the 1930s. The United States imposed income taxes briefly during the Civil War and the 1890s. In 1913, the 16th Amendment was ratified, however, the United States Constitution Article 1, Section 9 defines a direct tax. The Sixteenth Amendment to the United States Constitution did not create a new tax. Taxes provide the most important revenue source for the Government of the People's Republic of China. Tax is a key component of macro-economic policy, and greatly affects China's economic and social development. With the changes made since the 1994 tax reform, China has sought to set up a streamlined tax system geared to a socialist market economy. The ability of the United States government to tax and spend in specific regions has large implications to economic activity and performance. Taxes are indexed to wages and profits and therefore areas of high taxation are correlated with areas of higher per capita income and more economic activity. Tax protesters in the United States advance a number of constitutional arguments asserting that the imposition, assessment and collection of the federal income tax violates the United States Constitution. These kinds of arguments, though related to, are distinguished from statutory and administrative arguments, which presuppose the constitutionality of the income tax, as well as from general conspiracy arguments, which are based upon the proposition that the three branches of the federal government are involved together in a deliberate, on-going campaign of deception for the purpose of defrauding individuals or entities of their wealth or profits. Although constitutional challenges to U.S. tax laws are frequently directed towards the validity and effect of the Sixteenth Amendment, assertions that the income tax violates various other provisions of the Constitution have been made as well. Government revenue or national revenue is money received by a government from taxes and non-tax sources to enable it, assuming full resource employment, to undertake non-inflationary public expenditure. Government revenue as well as government spending are components of the government budget and important tools of the government's fiscal policy. The collection of revenue is the most basic task of a government, as the resources released via the collection of revenue are necessary for the operation of government, provision of the common good and enforcement of its laws; this necessity of revenue was a major factor in the development of the modern bureaucratic state. Taxation in Norway is levied by the central government, the county municipality and the municipality. In 2012 the total tax revenue was 42.2% of the gross domestic product (GDP). Many direct and indirect taxes exist. The most important taxes – in terms of revenue – are VAT, income tax in the petroleum sector, employers' social security contributions and tax on "ordinary income" for persons. Most direct taxes are collected by the Norwegian Tax Administration and most indirect taxes are collected by the Norwegian Customs and Excise Authorities. Taxes in Germany are levied at various government levels: the federal government, the 16 states (Länder), and numerous municipalities (Städte/Gemeinden). The structured tax system has evolved significantly, since the reunification of Germany in 1990 and the integration within the European Union, which has influenced tax policies. Today, income tax and Value-Added Tax (VAT) are the primary sources of tax revenue. These taxes reflect Germany's commitment to a balanced approach between direct and indirect taxation, essential for funding extensive social welfare programs and public infrastructure. The modern German tax system accentuate on fairness and efficiency, adapting to global economic trends and domestic fiscal needs. The policy of taxation in the Philippines is governed chiefly by the Constitution of the Philippines and three Republic Acts.  Taxation in Brazil is complex, with over sixty forms of tax. Historically, tax rates were low and tax evasion and avoidance were widespread. The 1988 Constitution called for an enhanced role of the State in society, requiring increased tax revenue. In 1960, and again between 1998 and 2004, efforts were made to make the collection system more efficient. Tax revenue gradually increased from 13.8% of GDP in 1947 to 37.4% in 2005. Tax revenue has become quite high by international standards, but without realising commensurate social benefit. More than half the total tax is in the regressive form of taxes on consumption. References- ↑ Section 2355, Title 68, Oklahoma Statutes - Income Tax Rates
- ↑ Section 1353, Title 68, Oklahoma Statutes - Purpose of Sales and Use Taxes
- ↑ Section 1001, Title 68, Oklahoma Statutes - Gross Production Tax Rates
- ↑ Section 1101, Title 68, Oklahoma Statutes - Petroleum Excise Tax Rate
- ↑ Section 1004, Title 68, Oklahoma Statutes - Gross Production Tax Uses
- ↑ Section 1104, Title 47, Oklahoma Statutes - Vehicle Taxes and Fees Apportionment
- ↑ Section 500.4, Title 68, Oklahoma Statutes - Motor Fuel Tax Rates
- ↑ Section 500.6, Title 68, Oklahoma Statutes - Gasoline and Compressed Natural Gas Tax Apportionment
- ↑ Section 500.7, Title 68, Oklahoma Statutes - Diesel Tax Apportionment
- ↑ Section 354, Title 17, Oklahoma Statutes - Motor Fuel Special Assessment Apportionment
- ↑ Section 302-5, Title 68, Oklahoma Statutes - Additional Tax on Sale, Use, Gift, Possession, or Consumption of Cigarettes - Rate - Apportionment
- ↑ Section 624, Title 36, Oklahoma Statutes - Insurance Tax Rates
- ↑ Section 312.1, Title 36, Oklahoma Statutes - Insurance Tax Appropritation
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