I began my time in public office as a school board member because I care about education. I believe strongly in the importance of funding education. I have voted for many funding packages for education in my past 11 years however, I was a no vote on this bill because of all of the problems it creates outside of education. Here are just a few of my issues with the bill and the reasons that I had to vote against it:
It's a tax on sales not profits
- HB 3427 is a tax on Oregon sales, not profits. That means even businesses that lose money are forced to pay the tax. This is particularly harmful to Oregon industries like manufacturing, which rely on a supply chain of Oregon-based goods to produce their products.
It's a hidden sales tax for working families
- The tax on businesses will result in raised prices on goods and products, especially everyday items. This means that consumers will end up paying the real price of the tax.
It taxes all businesses, not just corporations
- The bill specifically used the word "corporate" as a subject heading which is very misleading because it is a commercial activities tax not a corporate tax. It will not only apply to corporations, but also to LLCs and sole proprietorships.
It punishes small businesses and startups
- The $1 million exemption threshold in HB 3427 is too low and translates into thousands of small, family-owned businesses being included in the tax. This hurts the startup culture and provides more security for large corporations.
It provides no plan for PERS reform
- Even with $2 billion in new taxes, HB 3427 is unlikely to make a significant improvement in classroom outcomes. Oregon’s unfunded pension liability is almost $27 billion, forcing public employers to pay more money into the system every year. According to a recent analysis by The Oregonian/OregonLive, rising (pension) costs could consume nearly the entire tax increase by 2031.
Any provisions currently provided to agriculture or small business could be taken away
- The tax deductions, can be eliminated on a simple majority vote. The Legislature has previously revoked these deductions on simple majorities. As lawmakers inevitably look for additional revenue in future sessions, the deduction included in HB 3427 will undoubtedly be a target, meaning Oregon businesses could be stuck paying an even higher tax bill and consumers facing additional price increases for funding that isn't going to education.