The bill cut the top income tax rate from 5.25 percent to 5 percent, starting Jan. 1, 2015, with future cuts tied to revenue growth, the Oklahoman reported. It also created a fund for repairs to the state Capitol.
Justice James Winchester, writing for the majority, said the bill thus violates the "single-subject rule" established in the constitution.
"I am extremely disappointed in the Supreme Court's decision to unravel a plan that would have provided tax relief to Oklahoma families as well as a way of restoring our crumbling Capitol building," Gov. Mary Fallin, a Republican, said. "I will work closely with the Legislature to develop a strategy to move forward."
The bill was challenged by Jerry Fent, an Oklahoma City lawyer.
State Rep. Mike Reynolds, an Oklahoma City Republican, said legislative leaders have only themselves to blame. He said the tax cut could have been passed without adding the "pet project" of Capitol repairs to it.