See who got $64 million in state tax credits
It’s been a couple of years in the making, but the full effects of the state’s Taxpayer Transparency Act are finally coming to light.
The Office of State Finance’s Open Books site earlier this month posted the names of more than 5,500 individuals and businesses that used state income tax credits in 2007. You can search by name, type of tax credit and tax year. (Right now, only 2007 information is available.)
Some quick calculations of the 2007 credits show that 5,545 claimants used more than $63.6 million in state income tax credits. The maximum credit was for almost $2.4 million, while the smallest was for $1.
Here’s a list of the top credits used in 2007:
The top 20 claimants in 2007 used about one-third of the total claimed, or $21.16 million in income tax credits.
Some of the venture capital tax credits came under fire back in 2006 after creative accountants, bankers and tax attorneys found loopholes to exploit. The Legislature eventually closed those loopholes, although some don’t think the law was tightened enough:
March 26, 2006: Loophole in tax law threatens budget
April 17, 2006: Tax credits await changes
April 17, 2006: Tax credits may cost state millions
May 26, 2006: Senate approves plan to close loophole
Sept. 27, 2007: Tax credit letter causes public outcry
Oct. 12, 2007: State launches inquiry into fund
Sen. Randy Brogdon, R-Owasso, led the drive for the Taxpayer Transparency Act that allows scrutiny of state finances on the Open Books site. The latest part of the act compelled the state to post a searchable database of tax credit claimants on the site by Jan. 1, 2009.
Meanwhile, the members of the state’s Incentive Review Committee released their own report and recommendations for changes to the venture capital tax credits last year. The committee had problems with the Credit for Venture Capital Investment because only firms that qualified before 1992 could issue the credits:
The committee finds this disturbing for a number of reasons. First, this creates a significant competitive advantage for the firms that do qualify, at the expense of those that do not, violating the neutrality of the tax incentive. Second, if the benefits to the State from this credit are in excess of the costs, then one of two outcomes must be the result. Either potential opportunities to increase the State’s economic outcomes are being forgone, or the private benefit for facilitating the improved outcomes is being artificially targeted to firms that existed prior to July 1, 1992.
That particular credit expired Dec. 31, 2008, and was not renewed by the Legislature. However, the tax credits can be carried forward, so they could still be utilized in coming years by taxpayers who qualified before the cut-off date.
According to financial filings, executives of BOK Financial Corp., Bank of Oklahoma’s parent company, have bought that Venture Capital Investment tax credit in previous years:
In 2007, an affiliate of BOK Financial sold Oklahoma State Income Tax Credits to (a) George Kaiser, Chairman of the Board, receiving $9,234,100, and (b) Stan Lybarger, President and Chief Executive Officer, receiving $110,000. The credits are sold to affiliates as third parties.
Interestingly, Kaiser said earlier this month that legislators should stop tax credits for deep drilling by oil and gas companies.
–Paul
(Full disclosure: An executive of The Oklahoman/NewsOK.com’s parent company, OPUBCO Communications Group, shows up in the list of tax credit claimants on the state’s Open Books site.)
Written by Paul Monies
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Comments
[...] tax credits, such as the rural and small business venture capital credits, have come under fire in recent years in several cases of alleged abuse. The institute’s report touches on this [...]
[...] tax credits, such as the rural and small business venture capital credits, have come under fire in recent years in several cases of alleged abuse. The institute’s report touches on this issue: [...]
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[...] Hopefully, Burrage isn’t talking about posting a bland report several years after the fact. Maybe this is an issue that gubernatorial aspirant Sen. Randy Brogdon can get behind? After all, he’s already been the force behind opening up recipients of state tax credits. [...]