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Interesting idea but I voted No. Not because I don't think large corporations aren't paying enough but because it's a pyramid tax.
Here is the state's most liberal publication's take on it:
Corporate tax increase
No
We're convinced of a few things. First, state government could use more money. Education, social services and managing Oregon's rapid growth will require substantial new revenue.
Second, there is indeed a basket of corporate deplorables who unfairly avoid paying their fair share of taxes.
And yet Measure 97 is about as ham-fisted a solution as proponents could have devised. That may be because it was designed by pollsters and campaign strategists rather than economists. Crafting policy this way is hardly good governance, though we certainly understand the emotional appeal of demonizing Walmart, Comcast and Wells Fargo, all likely payers of the tax.
If Measure 97 passes, it would be the single largest tax hike in modern Oregon history. It would take the state's current annual budget of $9.5 billion and increase it by nearly a third, raising $3 billion a year.
It would do so by adding a new tax on C corporations—2.5 percent of their Oregon sales over $25 million.
The state estimates that fewer than 1,000 of the 400,000 businesses in Oregon would pay the tax, and many of those companies are headquartered in other states. (Disclosure: WW's revenues are far too small to be affected by 97.)
On its face, Measure 97 is elegantly designed: Somebody else pays it, and many of those somebodies are large, unloved corporations.
But like a fake Rolex, the moving parts underneath the surface are less elegant.
That's the reason why Gov. Kate Brown waffled for two months on whether to support the measure (she eventually did). It's the reason why moderate Democrats like state Sen. Mark Haas (D-Beaverton), who chairs the Senate Finance and Revenue Committee, and Rep. Jeff Reardon (D-East Portland) don't support the measure. And it's the reason why WW—which supported Measures 66 and 67, the 2010 income tax increases, and earlier this year supported Bernie Sanders in the Democratic presidential primary—cannot get behind Measure 97.
There are a host of reasons why the new tax would be bad for Oregon.
Independent analysts say companies will pass a big chunk of the tax on to consumers, so it is, in effect, a sales tax.
And unlike the conventional sales tax that nearly every other state levies, Measure 97 grants no exemptions for food, medicine or other essential goods. That's a double hit for low-income Oregonians. While market forces would keep some companies from jacking up their prices, others—like utilities—would be able to make customers, no matter how needy, swallow all the costs. And they will.
There's also an issue of fairness. Because the initiative affects only C corps, other companies that are structured differently but have more than $25 million in Oregon sales would not pay one dollar more. Finally, Measure 97 penalizes service businesses, such as the state's thriving software industry. (Because of arcane rules about how companies' revenues are accounted for, service companies are taxed more heavily than manufacturing companies.)
Then consider this: Even some supporters privately concede that the state has no plan for how to spend—or save—such an extraordinary increase in state revenues. That gives the special interests that sponsored the measure—public employee unions—and the special interests that opposed it and would be seeking exemptions—the business lobby—a tremendous advantage over lawmakers.
Putting pollsters and political strategists in charge of Oregon's tax policy is a bad idea. It is our hope that the Legislature, which will probably continue under Democratic control, can craft something better. Tax policy shouldn't fit onto a bumper sticker. Oregon can do better than this slice of populist fantasy.
http://www.wweek.com/news/2016/10/12/wws-november-2016-endorsements-state-measures/
Here is the state's most liberal publication's take on it:
Corporate tax increase
No
We're convinced of a few things. First, state government could use more money. Education, social services and managing Oregon's rapid growth will require substantial new revenue.
Second, there is indeed a basket of corporate deplorables who unfairly avoid paying their fair share of taxes.
And yet Measure 97 is about as ham-fisted a solution as proponents could have devised. That may be because it was designed by pollsters and campaign strategists rather than economists. Crafting policy this way is hardly good governance, though we certainly understand the emotional appeal of demonizing Walmart, Comcast and Wells Fargo, all likely payers of the tax.
If Measure 97 passes, it would be the single largest tax hike in modern Oregon history. It would take the state's current annual budget of $9.5 billion and increase it by nearly a third, raising $3 billion a year.
It would do so by adding a new tax on C corporations—2.5 percent of their Oregon sales over $25 million.
The state estimates that fewer than 1,000 of the 400,000 businesses in Oregon would pay the tax, and many of those companies are headquartered in other states. (Disclosure: WW's revenues are far too small to be affected by 97.)
On its face, Measure 97 is elegantly designed: Somebody else pays it, and many of those somebodies are large, unloved corporations.
But like a fake Rolex, the moving parts underneath the surface are less elegant.
That's the reason why Gov. Kate Brown waffled for two months on whether to support the measure (she eventually did). It's the reason why moderate Democrats like state Sen. Mark Haas (D-Beaverton), who chairs the Senate Finance and Revenue Committee, and Rep. Jeff Reardon (D-East Portland) don't support the measure. And it's the reason why WW—which supported Measures 66 and 67, the 2010 income tax increases, and earlier this year supported Bernie Sanders in the Democratic presidential primary—cannot get behind Measure 97.
There are a host of reasons why the new tax would be bad for Oregon.
Independent analysts say companies will pass a big chunk of the tax on to consumers, so it is, in effect, a sales tax.
And unlike the conventional sales tax that nearly every other state levies, Measure 97 grants no exemptions for food, medicine or other essential goods. That's a double hit for low-income Oregonians. While market forces would keep some companies from jacking up their prices, others—like utilities—would be able to make customers, no matter how needy, swallow all the costs. And they will.
There's also an issue of fairness. Because the initiative affects only C corps, other companies that are structured differently but have more than $25 million in Oregon sales would not pay one dollar more. Finally, Measure 97 penalizes service businesses, such as the state's thriving software industry. (Because of arcane rules about how companies' revenues are accounted for, service companies are taxed more heavily than manufacturing companies.)
Then consider this: Even some supporters privately concede that the state has no plan for how to spend—or save—such an extraordinary increase in state revenues. That gives the special interests that sponsored the measure—public employee unions—and the special interests that opposed it and would be seeking exemptions—the business lobby—a tremendous advantage over lawmakers.
Putting pollsters and political strategists in charge of Oregon's tax policy is a bad idea. It is our hope that the Legislature, which will probably continue under Democratic control, can craft something better. Tax policy shouldn't fit onto a bumper sticker. Oregon can do better than this slice of populist fantasy.
http://www.wweek.com/news/2016/10/12/wws-november-2016-endorsements-state-measures/
