Wall Street Journal Editorial Board 6/20:
The Labor Department reported yesterday that Oregon’s unemployment rate soared to 12.4% in May, the nation’s second highest after Michigan’s 14.1%. What to do? If you’re the geniuses in the state legislature in Salem, you naturally raise taxes.Last week the legislature approved a $2 billion tax hike on personal income and small businesses that haven’t already left the state. The highest tax rate on income above $500,000 would climb to 11% — up from an already high 9%. Oregon will soon boast the second highest income tax rate in the nation, moving ahead of California (10.55%), and only slightly behind New York City (12.6%). Corporations will pay a 7.9% tax on gross receipts, up from 6.6%.
But that isn’t the worst of it. Another revenue raiser will tax hospitals and private health insurance premiums. That’s a good way to encourage private employers to drop their health coverage for workers.
In Oregon, as in so many states this year, lawmakers had to choose between reducing the growth of spending and raising taxes. No contest. So government spending will climb by about $2 billion, or almost 4%, which is on top of a 21% increase in the 2007-08 biennium budget. The sliver of good news is that taxpayer groups like Americans for Prosperity of Oregon are promising to put these taxes before the voters in a referendum this year or next. Since Salem’s politicians seem intent on following California’s, maybe Oregon’s voters will do the same and just say no.