By Taxpayers Association of Oregon
Oregon Corporate Activities Tax (CAT) shoots the wounded as Oregon manufacturing hit the worst monthly decline since the 2009’s Great Recession.
Economists blame it on the long-standing trade war, supply chain disruptions and the pandemic. This misses the point. The Corporate Activities Tax acts as a second punch to these already crippled industries. The CAT taxes businesses on revenue and not profits, therefore when tough times come (pandemic, trade wars) the tougher more damaging the tax becomes. Politicians dismissed such concerns during the passage of the CAT tax saying big companies are big and they can handle it. Based on the data on jobs lost and destroyed manufacturers it turns out they didn’t handle it very well.
The CAT tax is one reason why our manufacturing has declined twice as much as the national average.
We need to admit that the CAT tax has become a costly failure. We should be cutting taxes like other states not chasing away our manufacturers with high taxes and crippling costs.