Arrogant Ignorance at Associated Oregon Industries
Chuck Sheketoff
On Friday, the Oregon Center for Public Policy released a new report, Corporate Tax Dodge: The Decline of the Oregon Corporate Income Tax and the Shift to Individual Taxpayers. The report documents how Oregon’s state corporate income tax has dropped to very low levels, both as a share of the economy and as a share of all income taxes paid in Oregon. The report explains that the long-term decline in corporate income taxes is primarily because corporations have won a number of tax breaks, and because corporations have grown aggressive about employing abusive tax shelters that lawmakers never enacted or intended to allow.
Who has benefited the most and who has been hurt the hardest by the tax shift? Multistate corporations enjoy the lion’s share of potentially taxable profits collected in Oregon and hence are the primary beneficiaries of the declining corporate income tax. As the tax burden has shifted from corporations to individual taxpayers, low-income taxpayers have been the hardest hit with increases. The report shows how neither the growth in “pass-through” businesses (e.g., S-corps and LLCs) nor the growth in fees is responsible for the decline in corporate taxes.
In a story in Saturday's paper (PDF), Joe Mosely, a business reporter with The Register Guard in Eugene, explained the problem in simple, easy to understand terms:
Look at it this way: Oregon's corporate community is our roommate, and the state budget is the apartment we share.
Thirty years ago, our roommate was responsible for an 18.5 percent share of the rent. That share is now down to 4.6 percent, and the rest of us are stuck with the balance.
According to Mosley's story, Associated Oregon Industries' lobbyist Joe Schweinhart apparently urged Oregonians not to give great weight to OCPP's latest report and used the opportunity to comment on the report's findings as an occasion to criticize all OCPP reports. OCPP relishes healthy, informed debate. But OCPP can't have that with AOI, because their lobbyist levels charges against OCPP reports while also admitting "I really don't read them, so I don't know what they say." (PDF)
No wonder AOI's still touting Oregon as a high tax state for businesses while the Council on State Taxation, a big business lobbying group, says that state and local taxes in Oregon are among the lowest in the nation.
"I really don't read them, so I don't know what they say." That's arrogant ignorance. And you can't argue with that.
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connect with blueoregon
May 23, '05
I can't imagine any topic of greater fundamental importance to our mutual well-being as Oregonians. Thanks, Chuck.
Fortunately, we can count on all our mass-media outlets to seize upon this injustice and trumpet it loudy before their audience.
No... wait... haven't our mass-media venues been pretty much swallowed up by the multi-national conglomerates your report exposes....?
May 23, '05
Is there ANYTHING more arrogant than Portland business people complaining about our taxes when they kick in less than 10 percent of the kitty. Puhleeze. Grow up!
p.s. to Mr. Boyle: don't let door hit you in butt on way out to suburbs.
May 23, '05
Nike and the Washington County Commission. Intel, PGE and the Oregon Legislature. Big pharma, the oil companies and Congress.
A state policy analyst recently told me that any of her statute or budget suggestions that are opposed by someone in the business community are DOA.
Corporate hegemony is pervasive. So, what shall we do about it?
9:57 a.m.
May 23, '05
Chuck, read your article and then looked to my left on the monitor to see your ad showing The Shifty Businessman with accompanying anti-corporate rhetoric.
Do your figures show all of the thousands of small Oregon businesses as being in the same boat as your "low and middle income Oregonians"?
I'd like to see you differentiate between large multinational publicly traded corporations and corporations that are closer to the ground.
My wife and I co-own a small software development firm (80-20)of which she is the CEO. We work like dogs for progressive causes, cover our employees medical to the tune of $7,000 to $10,000 per year, and pay city, county, metro, state, and federal taxes every damned year without whining. Why, as a matter of fact, my wife took the lead oppose the Republican led effort to cut capital gains taxes in her position as a member of the Governor's Small Business Council.
It would be very useful to the progressive effort if you wouldn't demonize all corporations as a group.
It makes recruiting more difficult, and it's dishonest by ommission and inference. Oh, yeah, and we are not now nor have we ever been members of AOI.
10:25 a.m.
May 23, '05
Pat,
I hear your concerns and value you and your wife's efforts.
I encourage you to read the full report (PDF). The report deals with state corporate income taxes (not)paid by c-corps generally, and notes that the folks who are the beneficiaries of the shift are the multistate corporations.
The report talks about the shift "to households and away from large multistate corporations" and "Among the losers are personal income taxpayers in Oregon, including small businesses and families, who must either pick up the slack from declining corporate income tax revenues or endure reductions in funding for public services benefiting the common good." Owners of S-corporations such as yours which pay income taxes through the personal income tax system. The report notes that all personal income tax payers are now left responsible for a bigger share of Oregon's rent payment, as the article analogized.
OCPP didn't mean to demonize all corporations.
11:16 a.m.
May 23, '05
Chuck,
I'm not complaining about the report itself. I'm complaining about the ad, and about a general tendency on the part of progressive warriors to lump us all together into the villan camp.
And we're not an S-corp either, we're a C-corp. The distinction that we make regarding the overall tax fairness issue is between large publicly held firms that can lobby for individual or collective relief and those of us who own our firms and see ourselves as responsible members of the community who have a duty to hold up our end of the financial burden.
We recognize that we may benefit financially from some initiatives put forth by lobbying groups, but we do not support, nor have we ever supported any efforts to shift tax burdens downstream to the aforementioned individuals and S-corps.
Thanks for your consideration.
Jun 6, '05
Tom Civiletti: Nike and the Washington County Commission. Intel, PGE and the Oregon Legislature. Big pharma, the oil companies and Congress.
A state policy analyst recently told me that any of her statute or budget suggestions that are opposed by someone in the business community are DOA.
Corporate hegemony is pervasive. So, what shall we do about it?
jk: Why don't you just kick thr rest of them out. Who cares about jobs anyway? We can all work for the government!!
Thanks JK