Defeated by the voters, it comes back to life in the legislature.
Editor's note: this is the third of a multi-part series recounting how the party in power is thwarting the will of the people. There is also a downloadable companion brochure
Gross Receipts Tax, also called the Corporate Activity Tax (CAT) is a tax on gross receipts regardless if a profit was made. It’s a tax to do business in Oregon. Oregon voters rejected the gross receipts tax ‘Measure 97’ in 2016, 60% to 40% and rightfully so: gross receipts taxes are regressive in that they raise costs to consumers and affect those at the lowest income levels the most.
Four states - Indiana, New Jersey, Kentucky, and Michigan, tried gross receipts taxes and found them harmful to the state’s economy and repealed them. Regardless, the 2019 Oregon legislature passed
HB 3427, a $2.5 Billion gross receipts tax, the largest tax increase in the state’s history. At the same time, Senate Bill 116-B passed, which preemptively torpedoed the ability of voters to refer
HB 3427 to the ballot by setting the election date for January 2020, which is notorious for depressing voter turnout, and allowing the legislature (in other words, Democrats) to write the ballot title rather than the customary Secretary of State’s office. It was a deliberate step to stop a challenge of the legislation.
The gross receipts tax was advertised as a way to increase education spending. Yet critics of the proposal contend that revenue from the new tax will likely be used to supplant existing education spending and raise overall spending. What got lost in the debate is the fact that Oregon’s rate of growth in education spending is topping the rest of the nation.
Forbes reports that “during the last half decade (2012-2017 data), state spending on K-12 in all 50 states increased by 16.5%. Yet in Oregon, K-12 spending rose much more rapidly, by 26.3% -- now putting Oregon near the top in spending per student. This means that
HB 3427 proponents are imposing a new tax, one of the most economically harmful, in order to put more money into an area of the budget that is already growing much more rapidly in Oregon than in other states.â€
What does Governor Brown plan to do to keep Oregon from the same downward spiral of increasing taxes as other states experienced, and how will she discourage people from fleeing? Are we headed for a state that looks like Detroit - no public services and bankrupt?
--Donna Bleiler| Post Date: 2020-08-16 13:54:14 | Last Update: 2020-08-08 14:52:54 |
