Hold on Oregonians. A tax tsunami is coming.

 

TaxTsunami

A tsunami of taxes is about to wash over Oregon.

The Democrats’ supermajority takeover of the Oregon Legislature, along with Kate Brown’s reelection, are the reason.

So, if you’ve seen your pay go up because of Trump’s tax overhaul (which, by the way, Democrats in Congress want to roll back) or a pay raise, get ready to see your gains disappear.

A Joint Interim Committee on Student Success that’s been touring the state gathering ideas on education policies and spending has already come up with an expensive wish list that includes:

  • Expanding career-technical education programs, including funding the $300 million that voters approved for high school programs with Ballot Measure 98 in 1916.
  • Extending the school year.
  • Fully funding the latest version of the Quality Education Model  all at once or over a specific period, such as three years. This could include: limiting class sizes (requiring more teachers and facilities); increasing the counselor-to-student ratio; adding counselors, librarians, TAG specialists, arts, music and physical education teachers; increasing spending on Pre-K programs; and reducing class sizes in the early grades and in schools with larger shares of students with higher needs.The State School Fund requirement to fund K-12 schools at a level   recommended by the Quality Education Commission (QEC) is estimated at $10.734 billion in the 2019-21 biennium, $1.963 billion more than the funding required to maintain the Current Service Level—that is, to keep up with inflation and enrollment growth.

An activist Legislature controlled by the Democrats, and supported by a Democrat governor, may also:

  • Modify Measure 5 to increase property tax revenue.
  • Seek a new gross receipts tax or value-added tax charged to businesses.
  • Set a cap on greenhouse emissions and require companies to buy pollution permits to cover their emissions.

And let’s not forget the likelihood of new sin taxes on tobacco and alcohol, including e-cigarettes, as proposed in the Oregon Health Authority’s draft 2019-21 budget.  That budget proposes increasing the cigarette tax from $1.33 to $3.33 a pack and the retail price of beer, wine and cider by 10 percent. The new taxes would cost consumers an estimated $830 million to help cover growing Medicaid costs.

sintaxcartoon

Then, of course, there are the measures just passed in Portland and the Metro Area, including:

  • Measure 26-201, Portland Clean Energy Initiative. Created a 1 percent surcharge tax or gross receipts tax on large retailers to pay for clean energy projects and job training. Before Nov. 6, supporters of the measure estimated it would cost affected businesses $30 million a year while opponents estimated it could cost affected businesses up to $79 million a year.
  • Measure 26-199 authorized $652.8 million in bonds to fund affordable housing in Washington, Clackamas, and Multnomah counties. The regional bond will cost 24 cents per $1,000 of assessed property value, or $60 per year for a home with an assessed value of $250,000.

And don’t forget the multiple local money measures on the ballot on Nov. 6.

Voters in the North Clackamas School District, for example, approved Local Option Levy 2018, a levy intended to address an anticipated $17 million operating shortfall to maintain current programs beginning in 2019. The levy will be collected through a property tax charged at a rate per $1,000 of assessed will be up to $1.63 per $1,000 of assessed property value. Homes with a median assessed value of $221,800 will pay up to $30 per month.

And in Eugene, voters in Eugene School District 4J passed Measure 20-297, a $319.3 million school improvement measure. Property tax rates will increase by about $0.66 per $1,000 of assessed value. Property taxes will increase by about $11 a month or $135 a year for the median homeowner in the district, with an assessed property value of $204,000.

And how about off-the-cuff proposals from politicians, such as Jo Ann Hardesty, who will be sworn-in as a Portland city commissioner in January. During her campaign she said she’d like to put a $2.50 tax on Uber and Lyft rides, which would, of course be paid by passengers.

Because the bulk of a tsunami lies beneath the sea surface, tsunamis are hard to detect when they travel across the open ocean and they can arrive unexpectedly. So consider this an early warning. Even if you can’t see it yet, a tax tsunami is coming.

Advertisements

2 thoughts on “Hold on Oregonians. A tax tsunami is coming.

  1. It makes my head spin to consider how much wealth (and separately, happiness) could be created by all these folks investing their energy in creating wealth rather than redistributing wealth. They should figure out a way to grow more beans, not just count beans!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s