Democrats and their union allies want to suck more money out of Oregon businesses than we thought.
Oregon’s Legislative Revenue Office predicted today (May 23, 2016) that Initiative Petition 28, if approved in November, would generate $6.1 billion in new revenue by the 2017-19 biennium. That’s almost $1 billion more than the $5.3 billion initially predicted.
Talk about greed!
The Revenue Office’s report also estimated that 38,220 private sector jobs would be lost by 2022 if the initiative passed. Meanwhile, in an odd twist, the public sector would add 17,700 jobs.
Talk about an absurd outcome!
And Gov. Kate Brown’s thoughtful response? “I greatly appreciate the analysis provided by the Legislative Revenue Office, which helps inform our understanding of the impacts of IP-28,” Brown said. “As I have said previously, the problem I remain focused on is how to improve our graduation rate and fund essential services while sustaining economic growth and protecting Oregon jobs. I will begin discussions with my legislative colleagues about a way forward that, should the measure pass, would safeguard new revenue for education while sustaining economic growth and protecting Oregon jobs.”
Whew! Makes you wonder if the governor is being paid by the word.
Initiative Petition 28 is being promoted by A Better Oregon, a campaign organization operating under the umbrella of Portland-based Our Oregon, a coalition of unions and progressive groups.
The measure would raise the corporate minimum tax on Oregon sales of more than $25 million a year from the current minimum of $50,000 to $30,001 plus 2.5 percent of the excess over $25 million. The tax would be based solely on sales, not profit.
Corporate taxes during the 2017-2019 biennium under the current system are projected to reach about $1.1 billion.
In other words, the passage of Initiative petition 28 would increase corporate tax collections per biennium by almost 600 percent in one fell swoop.
Rep. Mitch Greenlick (D-Portland), when endorsing the measure, said it would eliminate much of the constant need to choose between funding critical budget concerns each legislative session. “If that passes, we’ll have a lot of money to pay for stuff,” Greenlick said.
Otherwise, Greenlick said, most of the additional revenue in the economic forecast for the 2017-2019 budget would go to cover increased PERS liabilities and the state’s increased share of Medicaid funding, leaving little additional revenue for new stuff.
“This measure will make sure that large and out-of-state corporations do their part to fund the schools and services that will make Oregon thrive,” Our Oregon says.
As long ago as I can remember advocates for higher taxes in Oregon have been making “out-of-state corporations” the bogeyman, the malignant beast that’s doing Oregonians wrong and needs to pay.
But as attractive a target as these corporations are, they’re not fools. They will find a way to avoid paying the taxes or they’ll pass on the added taxes to Oregon consumers.
Then we’d all pay.
The liberal coalition behind Initiative petition 28, recalling their success in a tax increase battle in 2010, may be figuring they have a sure thing again with another measure targeting big business, but hopefully Oregonians in their wisdom will see this proposal is a reach too far.