By: Journalist Marlee Taylor (OSU)
Details of the Capitol Building
During the 2nd Session of the 56th Oklahoma Intercollegiate Legislature (O.I.L.), House Bill No.
OKWU-502, also known as The Consumption Tax Act of 2025, sparked debate on the future of
taxation in Oklahoma.
The bill, authored by Representative Molder (OKWU), proposes to repeal the existing state
income tax laws under Title 68 and replace them with a flat 10% sales tax on all purchases
made by residents, nonresidents, and businesses in Oklahoma. If passed, the law would go into
effect starting January 1, 2026.
Supporters of the bill argue it offers greater financial freedom and fairness. “When I work for my
money or when I own a business, I want to be able to keep all of that money upfront,” one
supporter explained. “It’s frustrating to work 40 hours a week and see part of your paycheck
automatically taken by the government.”
The supporter added that this new system allows people to control how much tax they pay by
choosing what and how much to buy. “A 10% tax at the point of purchase affects everyone
equally,” they said. “If someone spends a million dollars a year, they pay more tax than
someone who only spends $100,000.”
However, critics strongly oppose the bill, arguing that it would disproportionately affect
low-income Oklahomans. Anderson Bello, a representative from the University of Tulsa
delegation, expressed concern about the bill’s impact. “Sales taxes are the most regressive form
of tax,” Bello stated. “They hit lower-income people harder than higher-income people because
low-income families spend a larger share of their income on necessities.”
Bello also warned that repealing all existing tax code under Title 68 would dismantle important
state funding structures. “This bill would destroy the formulas we rely on for infrastructure and
education,” he said. “It’s not just replacing a tax—it’s wiping out the foundation of our state’s
budget.”
The bill has already received a friendly amendment to clarify language and adjust the
implementation year from 2025 to 2026.
As O.I.L. continues its session, The Consumption Tax Act serves as a powerful example of the
ongoing debate between simplifying tax systems and ensuring equity in taxation. The final
outcome may depend on whether lawmakers prioritize tax freedom or revenue fairness.