Oregon businesses pay fair share of taxes

Dan Lucas_July 2012_BW

by Dan Lucas

Marcia Atkinson reported in the Salem-Keizer Sentinel this week that Bill Dalton, Democratic candidate for state representative in House District 19 (Salem), told a neighborhood association that Oregon’s tax structure is outdated – that revenues are now “93% from individuals and 7% from business and corporations.”

Mr. Dalton isn’t even close on his numbers. It’s the same type of grossly inaccurate and false perception that Democrats successfully fostered during the Measure 66 and Measure 67 tax hikes back in 2010.

The truth is businesses already pay their fair share of Oregon’s taxes. Oregon businesses pay a third of all state taxes and half of local taxes (mainly property taxes). That’s according to the Total State and Local Business Taxes for FY2012 study, prepared by Ernst & Young in conjunction with the Council on State Taxation (COST) – published in 2013. [click here to see the relevant page in the study]

The COST study also noted that Oregon’s total state and local business taxes increased by 8.1% – more than double the national average state increase of 3.9%.

The COST study looks at more than just income taxes. It includes “business property taxes; sales and excise taxes paid by businesses on their input purchases; gross receipts taxes; corporate income and franchise taxes; business and corporate license taxes; unemployment insurance taxes; individual income taxes paid by owners of non-corporate (pass-through) businesses; and other state and local taxes that are the statutory liability of business taxpayers.” An example of an “other state and local tax” here in Oregon would be the Tri-Met tax paid by Portland area businesses.

The COST study has been cited a number of times (including in 2009 and 2011) by the Oregon Center for Public Policy (OCPP) – “the state’s leading progressive think tank.”

UPDATE (6/21): The best response to an Oregon Democratic candidate or official saying that “revenues are now 93% from individuals and 7% from business and corporations in Oregon’s tax structure” is to reply: that’s both inaccurate and extremely deceptive. It is more accurate and honest to say that Oregon businesses pay a third of all state taxes and half of local taxes. But for those who are interested in driving further down into the details, this addendum has been created to supplement the original article.

To read more from Dan, visit www.dan-lucas.com