Oklahoma Is Good for Business
If you want to learn more about us, you’re in the right place.
6% Tax Burden on Business
Oklahoma has one of the lowest business taxes in the nation.
4.85% Personal Taxes
Oklahoma lowered it top tax rate from 5.0% to 4.85%.
Lowest Gasoline Tax
Oklahoma has the second lowest tax on gasoline right behind Alaska.
Powerful Incentives
Oklahoma has world-renowned incentives packages for businesses in various industries.
Low Taxes
Some states tilt the playing field with their tax policies which benefit some industries over others. Not in Oklahoma. According to the Tax Foundation, our business tax climate is more economically balanced, and benefits all businesses that call our state home.
Oklahoma’s tax climate provides a boost during the crucial operations start-up phase and continues with stability and affordability as your business grows.
Oklahoma has 58 incentives program that will go straight to the bottom line.
Oklahoma’s tax climate is good for your business
Overview of Oklahoma Tax System
Take advantage of Oklahoma’s Business Incentives
We have world-renowned incentives packages for businesses in various industries. Here are a few of the 58 programs available:
- 5% cash back incentive
- Five-year ad valorem tax exemption
- 6% corporate tax rate
- Five-year investment/new jobs tax credit package
- Sales tax exemptions and more…
Quality Jobs Program The Quality Jobs Program makes quarterly cash payment of up to 5 percent of new taxable payroll to qualifying manufacturers and certain service industries that have a new payroll investment of $2.5 million or more.
Investment / New Jobs Tax Credit – 5-year tax credit on 1% of investment or $500/new employee
Ad Valorem Exemption – 5-year tax exemption on new assets. $250K investment + $250K – $1million new payroll
Aerospace Engineer Workforce Tax Credit
Employer benefits – Tuition Reimbursement tax credit; Compensation Paid tax credit
Employee benefits – Individual tax credit up to $5,000/year for first 5 years employment at an aerospace company
Manufacturers Sales Tax Exemption – Raw materials, machinery and equipment, power utilities
Small Employer Quality Jobs Program – The Small Employer Quality Jobs Program provides quarterly incentive payments to a qualifying small employer (90 employees or less). Quarterly payments may be as much as 5% of new taxable payroll for up to 7 years.
21st Century Quality Jobs – This Quality Jobs program is specially tuned for businesses with a highly skilled, knowledge-based workforce. This unique incentive may pay qualifying businesses cash back, up to 10 percent of payroll, for up to ten years for the creation of 10 jobs with an average wage of $94,000 annually or higher, depending on county.
American Indian Lands Tax Credit – Two-thirds of Oklahoma, because of its unique Native American heritage, qualifies for special federal tax treatment. Businesses locating or expanding in these areas benefit by 40% accelerated depreciation of investment and up to $4,000 employment tax credits when employing tribal members or their spouses.
Incentives Example
Incentive Overview
For manufacturers and certain types of service companies (research, development, and computer services), Oklahoma offers two options. Companies may choose either the Quality Jobs cash-back program, or the Investment on New Jobs income tax credit package. For manufacturers that invest over $40 million, both incentives may be available.
Business Incentive Analysis Example:
Example of a Small Manufacturer (NAICS 332) that makes a $30 million investment creating 200 jobs with an average salary of $38K/year:
Incentives Examples
| PROGRAM | ANNUAL ESTIMATE | FULL INCENTIVE | |
|---|---|---|---|
| 1a QUALITY JOBS OPTION Regular Quality Jobs (a Ten Year program) | (in 5% area) | $294,982 | $2,949,821 |
| or | |||
| 1b OR ALTERNATIVES TO QUALITY JOBS Investment Tax Credit (a Five Year program) | $285,000 | $1,425,000 |
|
| Sales/Use Tax Reimbursement on Construction Materials | (one time) | $477,375 | $477,375 |
| Incentives available to all new Oklahoma businesses: | |||
| 2 Five-Year Property Tax Exemption (a Five Year program) | $344,500 | $1,722,499 |
|
| 3 Freeport Tax Exemption (annual perpetual) | $90,392 | $903,922 |
|
| 4 Sales/Use Tax Exemption on Machinery and Equipment | (one-time) | $1,193,438 | $1,193,438 |
| 5 Sales/Use Tax Exemption on Goods Consumed in Mfg. Process (annual perpetual) | $1,789,732 | $17,897,319 |
|
| 6 Sales/Use Tax Exemption on Energy Use in Mfg. Process (annual perpetual) | $59,108 | $591,077 |
|
| Estimated Total Value of Incentives Over 10 Years | First Year Estimate | Full Incentive |
|
| *With 1a, Quality Jobs Cash Incentive | (in 5% area) | $3,772,151 | $25,258,074 |
| *With 1b, Investment Tax Credit Package | $4,239,544 | $24,210,629 |