Taxes - Page Two
Oklahoma Tax Commission

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The following taxes are available in a definition format on this page:

Liquor and Wine Excise Tax

Mixed Beverage Gross Receipts

Motor Fuel Importer Tax

Motor Fuel Tax Diesel

Motor Fuel Tax Gasoline

Motor Vehicle Proration Tax

Motor Vehicle Stamps

Pari-mutuel Tax

Rural Electric Coop Tax

Sales Tax

Special Fuel Tax

Strong Beer Tax

Tobacco Tax

Tourism Tax

Use Tax

Vehicle Rental Tax

Withholding Tax

Liquor and Wine Excise Tax
Excise taxes are imposed at the distributor/shipper level on all alcoholic beverages imported into or exported out of Oklahoma and passed onto the ultimate consumer. Distillery levels are as follows:

Mixed Beverage Gross Receipts
The mixed beverage gross receipts tax is levied at the rate of 13.5 percent on the total gross receipts from the sale, preparation or service of:
- mixed beverages;
- ice or non-alcoholic beverages to be mixed with alcoholic beverages;
- admission charges to mixed beverage establishments; and
- the total retail value of complimentary or discounted mixed beverages.

Motor Fuel Importer Tax
The motor fuel importer tax is a fuel use tax for motor carriers who are not licensed by an IFTA jurisdiction.

Motor Fuel Tax Diesel
Diesel fuel used or consumed in the state is taxed at the rate of $0.13 per gallon.

Motor Fuel Tax Gasoline
Gasoline used or consumed in the state is taxed at the rate of $0.16 per gallon.

Motor Vehicle Proration Tax
The International Registration Plan (IRP) is designed to simplify vehicle registrations for motor carriers operating interstate by allowing them to be issued one license plate and pay registration fees for all states.

Motor Vehicle Stamps
Upon assignment of ownership of a vehicle, including transfers to other dealers, a motor vehicle tax stamp is required to be affixed by the selling new or used licensed dealer.

A $3.50 revenue stamp to certificates of origin of the following new vehicles at the time of first sales includes: automobiles, trucks, motorcycles, travel trailers, manufactured homes, recreational vehicles, boats, and motors.

All used vehicles, except manufactured homes and commercial trailers, require a revenue stamp also.

This is a local government levy in lieu of ad valorem tax on inventories and is collected by county treasurer through the sales of revenue stamps. Used vehicle dealers must affix the revenue stamp to the title being assigned to the purchaser at the time of sale.

Pari-mutuel Tax
A pari-mutuel tax is collected from any organization licensed to conduct the pari-mutuel system of wagering on horse races. Each organization licensee that holds a race meeting at which the pari-mutuel system of wagering is conducted, retains an amount equal to 18 percent of all money wagered on win, place, or show wagers, to be distributed to the General Revenue Fund and the organization licensee.

Rural Electric Coop Tax
Rural electric cooperatives pay a state tax equal to two percent of the gross receipts from the sale and distribution of electric power during the calendar year.

Sales Tax
The state sales tax is 4.5 percent of the gross receipts or proceeds from sale or rental of tangible personal property and from the furnishing of specified services including public utilities, transportation, meals, lodging, admissions and auto parking.

Cities (Municipalities) may levy a sales tax on the same items that are subject to the state sales tax. This must be done by a vote of the registered residents in the locale. To date, a majority of local rates are at two and three percent.

Any county with a population of less than 300,000 may levy a county sales tax not to exceed two percent upon the gross proceeds or gross receipts derived from all sales or services in the county. Any county with a population of more than 300,000 may levy a one percent sales tax for the development of facilities for lease or conveyance to the U.S. Government and any infrastructure changes or improvements directly related to such facilities or economic development projects located within the county for a period not to exceed 36 months.

General consumer items not subject to sales tax are prescription drugs, residential gas and electric utility bills (except for county and city sales tax), motor vehicles and motor fuel. Exemptions granted commercial agricultural operations include farm machinery and replacement parts, feed, seed, plants, fertilizer, pesticides, livestock medication, and a wide variety of purchases to be incorporated into agricultural buildings, machines or systems.

Special Fuel Tax
Taxed at $0.16 per gallon are special fuels (LPG, etc.) used to propel vehicles on the highway. This includes any portion used in Oklahoma of such fuels imported in fuel tanks of vehicles used for commercial purposes. Also available is a LPG decal(s) which may be purchased in lieu of the special fuel tax. The decals and fees are as follows:

Strong Beer Tax
Excise tax is levied at the wholesale level for beer more than 3.2 percent at $12.50 per 31 gallon barrel.

Tobacco Tax
The following taxes are paid by tobacco wholesalers, and passed on to consumer in price paid.

Cigars weighing three pounds per thousand or more and rated Class C or below on the Federal Code are taxed at $0.03 each.

Cigarette-sized cigars weighing less than three pounds per thousand are taxed at $0.18 per package of twenty, or $0.009 each.

Smoking tobacco is taxed at 40 percent of factory list price and chewing tobacco, including snuff, at 30 percent of factory list price, regardless of any discounts.

Tourism Tax
Tourism tax is levied at 1/10 of one percent on the gross receipts received from the sale of food and drink; furnishing of rooms by hotel/motels, etc.; motor vehicle rentals; tour bus and sightseeing passenger carrier tickets; and admission to and sales by private tourist attractions. The tourism promotion tax is a levy on the privilege of doing business, and is not to be added to the sales price and collected from the consumer. Any business contributing to Oklahoma tourism promotion is required to file this tax.

Use Tax
The state use tax levy is 4.5 percent on the purchase price, to include pre-paid freight charges, of tangible personal property purchased outside Oklahoma and stored, used, or otherwise consumed within the State of Oklahoma by the purchaser.

The governing bodies of municipalities levying a local sales tax have the authority to levy a municipal use tax on out-of-state purchases of tangible personal property. The tax may not exceed the local sales tax rate of the municipality. The tax cannot be levied against tangible personal property intended solely for use outside the city or on tangible personal property which is only temporarily retained in the municipality for fabrication, repair, testing, alteration, maintenance or other service.

Vehicle Rental Tax
The vehicle rental tax is levied at six percent of the gross receipts on motor vehicle rental agreements of 90 days or less in duration on most vehicles that are rented to a person by a business engaged in renting motor vehicles without a driver. This tax is not in lieu of sales tax which is due on the gross receipts derived from all rentals.

The vehicle rental tax shall not apply to any lease agreements of greater than 90 days or truck or truck-tractors and trailers or semi-trailers with a laden weight or a combined laden weight of 8,000 pounds or more. This exemption became effective April 30, 1992.

Withholding Tax
Withholding schedules provide graduated rates of tax to be withheld by employers each pay period, giving consideration to wage-earner’s marital status and number of dependents claimed. These withholding rates are designed to approximately cover the tax that will be due annually for taxpayers with standard deductions.

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Web Page last modified 3/19/2003 3:00 p.m.