Monday, October 26, 2009

Corporate taxes in Oregon

The Oregon legislature passed a bill this last session increasing the minimum corporate tax from $10 to $150. The $10 minimum fee hasn't changed since 1931! Faced with massive budget deficits, the legislature enacted a combination of spending cuts and increased taxes to address the problem.

The bill was challenged through the referendum process so the issue will be voted on by Oregon voters in January. A "Yes" vote will keep the tax increases and the services these funds provide, a "No" vote will stop the tax increase forcing a deep cut in human services.

The legislative spending cuts were deep and real. I've talked to teachers who now have 3-5 more kids in every class increasing their workload. My teenage daughter has mentioned both the increased class size and the decreased school district support for athletics, music and other extra curricula activities like debate, dance, and more.

The tax increases were responsible and targeted. The tax increase on individuals only hits those earning $125,000 ($250,000 for married couples) or more, and then, the tax increase only hits their income ABOVE $125,000 ($250,000 for married couples). For corporations, they increased the minimum tax as noted above, and, also added a gross receipts tax of .0015 for corporations with $500,000 or more in Oregon sales. Both of these groups (corporations and wealthy people) can afford these very modest increases. Without the increases, the service cuts would be even deeper.

I had an "In My Opinion" piece in the morning's Oregonian. Check it our if you'd like to read more.

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