By Taxpayers Association of Oregon
On the November 8, 2022 general election ballot in Josephine County is a seasonal sales tax (Measure 17-112). The 3% April 15 to November 15 tax would be used for the Sheriff’s Office, Juvenile Department, District Attorney’s Office, the City of Grants Pass Police Department and the City of Cave Junction for law enforcement purposes.
The Josephine County Board of Commissioners voted unanimously August 10 to send the ordinance to the voters. All seven people testifying before the commission at the public hearing opposed the tax.
The Law Enforcement Retail Activities Tax, or LERAT, is expected to raise $10 million to $18 million, and would apply to retail sales including “deliveries to consumers at an address in Josephine County, such as orders filled by online merchants.” The tax would not include items exempted by state law such as groceries, rent, and prescription medications. Liquor and marijuana would also be exempt. Seven percent of the revenue would be deposited into a contingency fund in case revenue projections exceed the revenue that is received. Five percent of the tax would be returned to the merchants to cover administrative costs.
Grants Pass, expecting to receive $8 million in revenue from the proposed tax, will reduce their current public safety levy from $1.79 to $.79 per $1000 of assessed value for taxes beginning on July 1, 2023 if the county tax is approved. However, the levy decrease may be implemented “at any other time determined by the (Grant’s Pass) City Council,” and “The city Council shall retain the discretion to make any necessary budgetary adjustments to ensure appropriate City (Grant’s Pass) law enforcement funding.”
Here is the problem. Oregon state and local government is among the top biggest spending governments in the nation per-capita when compared to the other 50 states. Despite Oregon having the tax dollars, local governments continue to increase taxes. There are over 50 local tax increases on the November ballot totaling $1.6 billion.
Terri Collins owner of TLC Creations, told local news, “Tourism is down already due to the economy and small businesses are fighting for every penny that can get, and some of the locals may not like to see the sales tax.”
Lessons from other states show that once you enact a sales tax — the rate grows over time as politicians tweak the rate to bring in more revenue. Sales taxes start smaller and soon expand afterwards. The idea that this tax would only be seasonal and remain seasonal, goes against the national trend. Expect this tax to grow.
This sales tax comes as inflation/supply chain crisis/labor shortage are slamming small businesses.
Look at the chart below to see how the State has been hitting small business hard.