Just when we thought it was safe to go back into our businesses, we discovered we are being assaulted with yet another onerous tax Ñ one that will be economically devastating for many sole proprietors and small corporations doing business in the city of Portland.

In September, the City Council will vote on a proposed ordinance that will shift the way the current business income tax/business licensing fee rates are calculated and will add a tax on payroll. The three of us, all owners of local businesses, used the city's business calculation table, which is posted on the Web at

This is what it looks like for our very diverse businesses:

A restaurant with 26 employees will see a 118 percent increase; a creative services business, 164 percent; and a property management company, 243 percent, in just this tax alone. This is in addition to the business surcharge recently levied by the city and, of course, the recent addition of an income tax in Multnomah County.

As small-business owners, we are acutely aware of the need for good schools and high performance standards for our students. We draw many of our employees from the student bodies of our local high schools. We create jobs through our very existence and will add more jobs if we grow and thrive.

However, we believe that this proposed tax on payroll will do more harm than good by negatively affecting the very source of a healthy community Ñ small businesses. The tax shift will harm local manufacturers, retail firms, grocery stores, restaurants and hotels, forcing them to cut jobs (maybe yours) and pass costs on to consumers.

A tax on payroll in no way reflects the ability of a business to pay the tax. And, in fact, it's a tax on an expense, not income. That is fad business. We constantly hear how important jobs are in our city's economy. However, with this proposal, the businesses creating the most jobs will get hit the hardest. How will the elimination of private-sector jobs ever help the city or county budget provide essential city services?

The mere creation of this proposed tax shift will add costs for collection and compliance (not to mention the chaos we have recently witnessed at the county level).

We are not lobbying for a reduction in taxes. A cut in taxes would be nice, but not at the expense of essential public services. What we do want is fairness.

This proposal was born out of frustration by businesses that find the existing tax/licensing fee formula overwhelmingly oppressive. But the answer is not to shift the burden onto other businesses.

Businesses large and small are all facing tough economic burdens. We all are feeling the impact of rising gasoline prices, increases in the minimum wage, health benefits, insurance rates, utility costs and all of the other taxes and fees we each pay.

All of the business owners licensed by the city of Portland and/or Multnomah County doing business in the city and/or county must fill out a business payroll information form.

Also, if you have not yet used the proposed tax-reform calculation form to see how this new tax structure will affect your business, we urge you to do so now. Both are available through the Portland Bureau of Licenses or on its Web site at

The information you submit on these two forms could very well be the catalyst that will influence our elected officials to put an end to this proposed taxation inequity before more businesses and jobs are lost. This is your golden opportunity to help mold the profile of your taxing mechanism.

Ethan Dunham is chief executive officer of Pulse Business Systems in Northwest Portland; Ken Turner is the general manager of the Eastport Plaza shopping center; Connie Hunt and her husband operate the East Bank Saloon and Restaurant. All three are members of the City of Portland's Small Business Advisory Council.

Go to top
Template by JoomlaShine