EDITORIAL
Split-mil’ tax battle
has already begun
With three months to go before the November elec
tion. sparks have already begun to fly in the battles
over statewide ballot measures. It is a safe bet that the
most hard fought campaign will be over the OCA's
anti-homosexual Measure 9. But following a close sec
ond will most likely be the proposed "split-roll’' prop
erty tax amendment to Measure 5.
Measure 7, as the split-roll tax will appear on the
November ballot, is sponsored by Oregon Fair Share
and aims at restoring between 60 percent and 70 per
cent of the revenue lost under Measure 5.
Before Measure 5. homeowners and commercial
property owners paid different property tax rates. After
Measure 5. rates for both types of property became
equal, and will eventually settle at $15 per $1,000 of
assessed value. Measure 7 would amend Measure 5 by
setting commercial-property tax rates at $30 per
$1.000, still less than what they were before Measure 5.
Already, there have been reports of landlords
threatening to raise rents $50 to $100 per month, busi
nesses laying people off and/or increasing prices to off
set what they are portraying as a tax increase. Such
claims are patently false and to act on them would be
just short of criminal.
Currently, commereial-property taxes are set at $25
per SI .000. In pre-Mcasure 5 Lane County, those taxes
were $31.44 per $1,000. Setting them at the proposed
$30 per SI ,000 would be an increase only in the sense
that businesses would not receive continued windfall
savings.
The thinly-veiled attempts at extortion by land
lords who oppose Measure 7 must be exposed for the
hypocritical double speak that they are. Primarily, why
do rents need to increase $50 per month when proper
ty taxes are raised by $5 per $1,000, yet they did not
decrease by S50 when property taxes fall by more than
$6 per $1.000. Something's rotten in Denmark.
The benefits of Measure 7 are many. Not only
would the meusure replace much of the revenue lost
under Measure 5. the saved money would be directed
solely at education, thus freeing up the millions of dol
lars in the state's general fund that would have gone to
education, short-changing other state services. Measure
7 would also provide for rent relief, something not
found in Measure 5.
Some people voted for Measure 5 to punish what
they perceived to be wasteful state-government. Most
people voted for Measure 5 because property taxes
were simply too high, and therefore have little reasbn
not to vote for Measure 7. Homeowners would still get
their tax relief, and the state would get a reprieve.
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COMMENTARY
Sales tax places burden on poor
By Jason W Moore
Gov. Barbara Roberts'
failed tax package cer
tainly left something to
be desired, continuing to place
the heaviest tax burden on
those least able to pay. None
theless. it represented a real op
portunity for much-needed lax
reform, oven if it was only a
step in the right direction. Sad
ly. that opportunity has been,
for the moment, shot to hell.
Kotxirtx proposed a new sales
lax of 3.5 percent on goods
only, reduced property taxes
from the current {post-Moasuro
5) S25 per $1,000 assessed val
ue to $15 for homeowners and
$20 for commercial property
owners and slightly cut person
al state Income taxes. The most
drastic change was the intro
duction of a sales tax. an idea
that has never received the ap
proval of more than 29 percent
of Oregon voters during its nu
merous appearances on the bal
. lot.
Mainstream debate over the
sales tax often ignores the larg
er issue, namely, that the sales
lax Is both economically and
socially Irresponsible — it Is a
fundamentally regressive tax.
The poor and working class,
who consumo virtually all they
earn, are, not surprisingly, hit
hardest by a tax on consump
tion A working class family
that buys a now refrigerator
pays considerably more tax
dollars as a proportion of its to
tal income than its uppor-mid
dln class counterparts who do
the same. A significantly larger
part of upper-middle class in
come Is directed not into con
sumption but into investment
— largely speculation that
amounts to so much paper
shuffling, with no material ben
efit to anyone not woalthy
enough to own a stock portfo
lio.
Building on the above exam
ple. we can see the economy
benefits more from tho pur
chase of a refrigerator than
from the purchase o! stocn
(more monoy. to be ugain di
rected into consumpllon, finds
Its way into the hands of work
ers through the production,
transport and sale of a manu
factured good instead of into
those of stockbrokers and law
yers involved in high finance,
probably only to be invested
unproductively again ... ). So.
why impose' a tax that would
increase the price of manufac
tured goods, thereby reducing
consumer confidence, purchas
ing power and consequently,
overall employment?
Roberts pays lip-service to
lessoning the tax's rogrosstvity
by exempting food arid health
care. She fails to take the one
step that would really have an
impact — taxing services, such
as the work dono by high-pow
ered lawyers, accountants and
stockbrokers. Those, of course,
are services that businesses use
regularly, and that are already
prlcod out of reach of evon
many middle class consumers.
Proponents claim that the
sales tax is a way to get at some
of thoso previously untaxod.
such as tourists and drug doal
ors. In doing so. howover. the
sales tax serves to tax children,
the elderly and the destitute. Is
this a fair tax for Oregon?
A fair alternative to the sales
tax is a tax on income produc
ing property and Roberts right
ly proposed such a tax In hor
package. Conservatives claim
that his will cost jobs and raise
prices. A slate's taxation poli
cies. however, have loss to do
with attraction and retention of
business and Investment than
do. for instance, a good educa
tion system, a workable Infra
structure. or a viable pool of
consumers ready to spend. Di
minished human services can
only harm all three of these,
and harm the “good buslnoss
climato."
What’s more, "If business
was not leaving the state In
1990 because of (pre-Measure
5) property taxes, why would
moy itjavi! ihm.uum! wb ruium
thorn to the 1090 lovel?" asks
Joy Marshall, local organi/or
for Lane Fair Share, referring to
her organization's tax proposal.
The same logic applies to the
argument that this will result in
higher prices for consumers
We know they didn't lower
prices when taxes fell; why
should they raise prices when
taxes are restored to 1990 lev
els?
The real key to tax fairness,
as Roberts must realize, is taxa
tion that places the burden on
those most able to pay. The tax
structure most capable of giving
genuine tax relief for Oregon
homeowners, promoting a
healthy economy and provid
ing the full rangii of human ser
vices is progressive taxation
that includes not Just fair taxes
on commercial property but
taxes on personal wealth and
Income. Creating higher tax
brackets for wealthier individu
als (Oregon's income tax lops
out at only $10,000 per year),
and Inheritance and luxury tax
es are crucial options that the
Roberts plan overlooked.
Oregon Fair Share (Lane
County chapter; 344-0650) has
placed the Fair Homeowners
and Renter's Relief Measure on
the November ballot (Measure
7). This would split the proper
ty tax rolls, establish a $30 per
$1,000 cap (still lower than
pre-Measure 5 levels in
Multnomah and Lane counties)
on commercial property, pro
vide immediate tax relief for
homeowners and make up two
thirds of the Measure Flvo
shortfall.
The Roberts' proposal got at
least one thing right — those at
the top must be taxed fairly for
the befit of all. But only the
Fair Share initiative carries this
thinking to its logical conclu
sion.
Jason W Moon Is the co-edi
tor of the Student Insurgent and
co-director of the Center for
Contemporary Activism.