Tax burden isnt for businesses alone
With the lowest business-creation rates and highest unemployment in the nation, it is incomprehensible that anyone would suggest raising business taxes as a fix to Oregon's economic problems.
The idea that businesses in Oregon are getting out of paying their fair share by accounting gimmicks, manipulating the Legislature and tax breaks is patently untrue. Making our state's businesses successful will be the key to restoring Oregon's economic vitality, and they need to be treated as allies.
Citing certain taxes as examples of corporate welfare is overly simplistic and does not stand up to an honest review of the overall tax burden placed on business. Corporations not only pay income and property taxes like the rest of Oregon's citizens, but they also pay a state property tax on their furniture and equipment, are taxed twice for dividends, and are subject to myriad city and county taxes, licenses and permits.
While an individual in Oregon has an effective tax rate of 5.3 percent after deductions, a profitable company in Portland may have a tax rate of more than 10 percent.
Oregon's businesses work hard to be competitive, employ individuals and hopefully realize a profit at the end of the day. The idea that big business is keeping money from cash-strapped schools and other vital services is ludicrous. More than 89 percent of companies in Oregon are small Ñ employing fewer than 20 people. Profits, not taxes by the government, are reinvested to increase productivity, increase worker pay, cover ever-increasing costs of health benefits and to reward stockholders who risked money in the business. How does increasing taxes on corporations help anyone other than the bureaucracy?
One could ask, if Oregon's tax system is so friendly to corporations, why aren't they locating here in droves? The state has developed a reputation throughout the nation as business-unfriendly. It is hard to find any facts that would substantiate the idea that corporations receive special treatment in Oregon.
In the early days of America, the only way for pilgrims to settle in this country was to combine their assets in order to minimize their risks and share their profits. In other words, America was built with corporations. Today American corporations are not only under attack by liberal think tanks and unions but by the world economy, politicians looking for an easy headline and frivolous lawsuits by trial attorneys.
If there is anything that our current economic crisis should teach us, it is that we are in this together. Whether we are employers, employees, state workers, students, pensioners or newborns, we need a tax system that supports our needed services and doesn't waste our tax dollars. That tax system should not single out one group over another to shoulder the burden; it should respect the contributions of business, individuals and our government services equally. That is tax fairness.
Richard M. Butrick has been the president of Associated Oregon Industries since 1986. Formerly employed in California, he now lives in Silverton.