The Secretary of State’s office confirmed June 6 that IP 28, the “A Better Oregon” initiative, qualified for the November ballot. Now called Ballot Measure 97, voters’ approval would require corporations with more than $25 million gross sales in Oregon during a single year to pay a 2.5% tax on those sales beyond that amount.
Currently, corporations with $25 million in gross sales pay a minimum tax of $30,000, a tax rate of 0.12%. Those that gross $100 million or more in sales (no matter how much more) pay a minimum tax of $100,000. at’s a tax rate of 0.10% and even less for corporations that gross more. If voters approve Ballot Measure 97, those corporations, who are participants in the Oregonian community, are to assume a share of the tax burden that is closer to their fair share. The money should be used to improve our education system, make health care more affordable, and expand services for seniors.
A corporation with $40 million in gross sales, for example, would pay $405,000. That’s only a 1.0% tax rate and the result of the $30,000 minimum tax plus $375,000, which is 2.5% of gross sales beyond $25 million.
A corporation that grosses $80 million would pay $1.4 million. That’s a 1.8% tax rate, the result of the same formula, except 2.5% of gross sales beyond $25 million is more in this case.
A corporation with $120 million in gross sales would pay $2.4 million, a 2.0% tax rate and the result of the same formula.
Ballot Measure 97 is not a sales tax. It will likely have little impact on consumer prices, and it will have no effect on the taxes paid by the overwhelming majority of Oregon businesses.
Oregon’s non-partisan Legislative Revenue Office estimated that about 1,000 corporations out of the more than 400,000 registered Oregon businesses are to be affected. Only about 50 of these corporations will pay half of the nearly $3 billion per year the measure is expected to raise. They are mostly large and out-of-state corporations like Walmart, Comcast, Monsanto, and Bank of America who generate well over $100 million in gross sales each year in Oregon. Their operations are regional or national in scope, so the great majority of them will maintain a uniform pricing strategy and not pass on price increases to only their Oregon customers.
As measured by the Anderson Economic Group, Oregon is last among all states in effective taxation of businesses. The Oregon Center for Public Policy documented that the portion of income tax revenues paid by corporations dropped from 18.5% during the mid-1970’s to 6.7% now. If we don’t change our tax structure, the corporate share of the Oregon income tax burden will drop further to 4.6% in the next seven years.
While passing Ballot Measure 97 will significantly improve the fairness of our tax system, it will still leave Oregon ranked in the bottom half of states. Oregon’s effective business taxes would still be less than those of Califor- nia, Washington, and Idaho.Ballot Measure 97 is not a sales tax. It will likely have little impact on consumer prices, and it will have no effect on the taxes paid by the overwhelming majority of Oregon businesses.
Passing Ballot Measure 97 will improve our chances for success in higher education wage and bene t negotiations next year, will allow the UO to grow and improve without having to rely on big tuition increases, and will literally make it possible for us to create A Better Oregon. Among the many important election campaigns our union wil be engaged in this fall, please make time to help out on this one.