We will increase the City’s sales tax revenue by supporting growth in retail sales. Sales tax revenues account for over half of the City’s budget due to the state constitution, which does not permit the use of more stable property taxes for operations. The reliance on sales taxes makes cities in Oklahoma very sensitive to the economic cycle. In addition, Oklahoma cities often compete with each other for sales tax revenue because it is distributed to cities entirely based on point-of-sale. Some states or regions address this issue by using distribution formulas at least partially based on population or other factors. Until the distribution method changes, or until such time as the state constitution is amended to allow more flexibility in the use of various tax sources, Oklahoma City must pursue strategies that help increase retail sales. The City will work to attract more retail activity and improve existing retail corridors, to ensure their future viability. These strategies must:
- Reduce leakage of local consumer dollars to other jurisdictions and non-taxed sellers.
- Import consumer spending from outside by providing unique destinations and retail environments.
- Increase sales through community growth and investment.
- Require on-line sales to compete on an equal basis with brick and mortar sales.
We will increase the City’s property tax revenue by increasing property values. Many planokc initiatives involve reinvestment, neighborhood stabilization, and efficient growth policies that will ultimately raise property values. This is good for both property owners and the public sector. For the former, raising values raises individual net worth and the stability of people’s investment in the city. For the latter, it creates both greater overall revenue and greater revenue yield per square mile of urban area. Redevelopment of areas like Core to Shore, restoration and full use of areas with depressed valuation, and incremental improvement of urban neighborhoods all serve the dual goals of improving life in the city and improving the City’s ability to provide the excellent services citizens expect and deserve at affordable cost.
We will consider ways to make the tax structure more stable, resilient, and balanced. The City will explore and evaluate options such as greater flexibility in tax sources that can fund City operations, reducing unnecessary tax exemptions, considering sales or marginal taxes on some types of goods and services, and taxing on-line sales.