Oklahoma's Own In Focus: State Grocery Tax Cut

A new bill was signed into Oklahoma law Tuesday by Gov. Stitt. This law will completely remove the state’s grocery tax.

The law is set to go into effect in August, eliminating the state’s 4.5% sales tax on groceries.

The bill cleared the Oklahoma House of Representatives in March, but the Senate did not approve the bill until Feb. 22, 2024.

Lawmakers say this is the largest single-year tax cut in state history. Senate Pro Tem Greg Treat says this tax cut will save the average Oklahoman $400 a year. 

It’s important to note that this will not impact city and county taxes on groceries, which are often used to fund local roads and bridges. Treat says this is the only tax cut the Senate will approve this year. "We cannot spend beyond our means,” said Treat.

The Senate did not pass the emergency measure on this bill that would have allowed the measure to go into effect immediately upon being signed into law. Treat says the reason for that was to give the Oklahoma Tax Commission and local grocery stores time to prepare and adjust.

Minority House Leader Cyndi Munson sent a press release, celebrating the tax cut. “This is a great policy with consistent bipartisan support,” Munson said. “Not only are we helping to lower costs for working families, but it is a key issue House Democrats prioritized for many years - a win for all Oklahomans.”

Read Minority House Leader Cyndi Munson’s full statement below:

"I am pleased Governor Stitt has signed the elimination of the state sales tax on groceries into law. For the past several sessions, including special sessions, the House Democratic Caucus has filed and authored legislation to eliminate the state sales tax on groceries to provide immediate tax relief for working Oklahomans each time they go to the grocery store. This is a great policy with consistent bipartisan support, so I am happy we get to come together to celebrate today. Not only are we helping to lower costs for working families, but it is a key issue House Democrats prioritized for many years – a win for all Oklahomans."

The governor reiterated his call for the elimination of the state income tax but Pro Tem Greg Treat continues to say the senate will not be cutting that tax this year.

What’s Not Covered?

There are a few things that won't be tax-exempt.

That includes ready-to-eat foods, like pre-packaged foods and fruit bowls, as well as alcoholic beverages and tobacco products.

Click here for a link to all foods not included in the tax exemption. 

The Governor said on Tuesday, that it's been years in the making and it all started in 2008.

History Of The Tax Cut Push 

2008

That year the Senate passed a bill but it didn't go anywhere.

2009-2010

In both 2009 and 2010, a tax cut was passed in one chamber but not the other.

2017

Jumping ahead to 2017, then Governor Mary Fallin pushed for a cut but it didn't go anywhere because of an $800 million budget shortfall.

2022

Lawmakers had been at a stalemate since 2022, until last week when Senators passed the bill signed today.

February 27, 2024

Bill was signed into law, by Gov. Stitt.

August 2024

The law goes into effect 90 days after the session ends, which will be in August.

July 2025

The bill doesn't eliminate the local sales tax on groceries but prohibits cities and counties from increasing it until July 1, 2025.