OKLAHOMA CITY, OK -- Oklahoma operators scored an important victory on April 18 when Gov. Mary Fallin signed a bill that rolls back last year's 300% fee increase on vending and amusement machines to a 50% increase.
Under the bill, sponsored by state Rep. Charles Ortega (R-Altus), the per-machine fee will drop from $150 to $75, effective July 1. Ortega's bill (HB 1634) unanimously passed the Oklahoma House on March 15. The state Senate passed the measure on April 14.
Upon introducing his rollback bill, Ortega said the $150 fee, a triple increase, was bad policy. He said the triple fee increase was excessive and threatened to drive many operators out of business, which will ultimately reduce state tax collections. The House's unanimous approval in March, the lawmaker added, was a vote to support to small business owners across Oklahoma.
Oklahoma operators purchase a decal for each machine they place for an annual flat rate instead of paying taxes on total sales volume generated by machines, vending and amusement. In 2010, state lawmakers passed a measure that increased the cost of the state's sales tax decal for vending and coin-op amusement equipment from $50 to $150. Fees for operators had not increased since 1988. | SEE STORY
The Oklahoma Vending Association staged a campaign to reduce the fee in response to the 2010 bill's passage. In December, the association provided public comment to the Oklahoma Tax Commission, and in January industry representatives attended a hearing as the commission revised its tax rules to conform to the provisions of the new law. | SEE STORY
Tax officials estimated the tax increase would bring in about $6 million a year, compared with $3 million under the previous structure, which would help close the state's $1.2 billion budget shortfall.
According to tax records, there are 54,323 vending machines across Oklahoma.
The vending association and bottlers had estimated that the proposed fee increase would have forced operators to remove about 30% of their vending equipment from the field, which, if accurate, could have inflicted $6.5 million in losses on the state as a result of layoffs.