NORTHWEST LABOR PRESS | October 21, 2016 | PAGE 5
Five corporate lies (and two truths) about Measure 97
$17.9 million in mostly out-of-
state corporate money buys a lot
of ads and spreads a lot of disin-
formation, doubt and fear about
Measure 97. Don’t be fooled.
IT’S A SALES TAX!
(No … it’s not.) Oregonians do leave the
state sometimes, so they know what a sales
tax is: If you were to buy a smartphone, say,
in Clark County, Washington, you’d pay 7.7
percent sales tax. It’s on the receipt. Oregon is
one of just five states without a general sales
tax, and Measure 97 won’t change that,
because it isn’t a sales tax. Consumers
wouldn’t pay it. Small businesses wouldn’t
pay it. It’s a corporate minimum income tax
that only the very biggest companies would
pay. And that’s long overdue. Up to now,
giant companies have employed legal and
accounting maneuvers to claim that they
make no profit — despite hundreds of
millions in sales — and thus they pay
almost nothing in state corporate income tax.
For example, companies that donated to the
anti-Measure 97 campaign had $600 billion
altogether parked in offshore tax havens.
That’s money they claim was earned in places
like the Cayman Islands — so they can get
out of paying state and federal income tax. If
Measure 97 passes, they won’t get away with
playing “poor” any more.
IT’LL LEAD TO HIGHER PRICES ON
ALMOST EVERYTHING!
(No … it won’t.) Ask yourself this
question: Are Cheerios more expensive in
Vancouver than Portland? After all, tax
systems vary quite a bit around the country.
Do big companies like Target, Lowe’s, Toys R
Us and Walmart charge more in states where
they pay higher taxes? The folks behind
Measure 97 wanted to find out, and teamed
up with the non-profit Oregon Consumer
League to do a study. They found that those
companies charge exactly the same prices for
their products in every state. Maybe it’s not
surprising that companies that do business
nationally set their prices nationally. But it
definitely means there’s no reason to think
they’ll raise prices just in Oregon if Measure
97 passes. [Skeptical of their findings? Thanks
to the magic of the internet, you can do your
own cross-state price comparisons. Visit
http://bit.ly/2dpKP18 to see how] Oh, and
one more thing: If the biggest corporations
could just pass this tax onto the consumer via
higher prices, why would they contribute
$17.9 million to talk you out of voting for it?
IT’LL CAUSE LOCAL JOB LOSSES!
(On the contrary: It’ll use money that’s
now leaving the state to create local
jobs.) First let’s be honest: Big out-of-state
companies aren’t particularly interested in
creating local jobs. They’re interested in
making money; if hiring more locals helps
them make more money, they do that.
Measure 97 opponents want you to think the
big companies affected by the tax will cut
jobs because of the increased taxes. But it’s
hard to see why — if employing locals helps
them make money. And if they do cut some
jobs, out of spite or for business reasons,
there’s something very important to know:
There’s no secret incinerator beneath the
Capitol building in Salem where lawmakers
burn tax dollars. The money this tax raises will
go overwhelmingly to hire teachers, health
care providers, and homecare aides. So
instead of leaving the state to fill the pockets
of CEOs and investors, that $3 billion a year
will employ Oregonians providing services to
other Oregonians, who will spend their
money locally.
IT’LL HURT SMALL BUSINESS!
(So says big business.) If anything,
Measure 97 could help small businesses. For
many small businesses, the biggest threat to
their existence is big businesses. And Measure
97 might help, just a little, because the Ugly
Mug Coffee House in Sellwood won’t be
paying the Measure 97 tax, but its competitor
Starbucks will. Only the top one quarter of
the top 1 percent of companies doing
business in Oregon will pay this tax — about
400 companies in all. And even in that group,
it’s the giants that will pay the most: The
Legislative Revenue Office estimates that 51
percent of the money raised by Measure 97
will come from just 50 corporations.
“MEASURE 97 WILL DAMAGE THE
ECONOMY, RESULT IN 20,000 LOST
JOBS, AND HURT CONSUMERS AND
LOW-INCOME PEOPLE IN THE
STATE OF OREGON!“
(Sounds familiar, doesn’t it?) Big
corporations think if they say these things
often enough, voters will believe them. It’s
what the union-backed group Our Oregon
has come to call “The Corporate Playbook.”
And corporations are using the same
playbook for every occasion, around the
country — any time a law is proposed that
might restrict their profits. Our Oregon
documented over 200 instances of large
corporations making these arguments, often
using almost identical language, to oppose
very different kinds of proposals. In Oregon
they said it in 2010 about Measures 66 and
67, which modestly raised tax rates on the
wealthiest individuals and corporations; then
they said it in 2015 about a law giving
workers paid sick leave; and they said it in
2016 about the increase in the minimum
wage. In each case, none of those dire
predictions came true.
THERE’S NO GUARANTEE THE
LEGISLATURE WILL SPEND THE
MONEY AS DIRECTED!
(Okay, that’s actually sort of true.)
To be fair, the text of Measure 97 couldn’t be
clearer: “All of the revenue generated from the
increase in the tax created by this 2016 Act
shall be used to provide additional funding
for public early childhood and kindergarten
through twelfth grade education; healthcare;
and, services for senior citizens.” Could the
Legislature break faith with voters and vote to
spend the money elsewhere? Yes, under the
Oregon Constitution they could, but the
groups backing the measure will be watching
closely, and won’t be silent if lawmakers
ignore the will of the voters. And at the end of
the day, would it be a disaster if SOME
additional revenues ended up going
elsewhere — a bit more support for higher
ed, an uptick in drug treatment to combat
meth addiction, hiring a few more state
troopers? The bigger danger is that some
lawmakers — those most eager to curry
favor with business interests — will fritter
away some of the new voter-approved
revenues by creating new corporate income
tax breaks. If they try, the Northwest Labor
Press will report it. Oregon is already giving
up more than enough money in the form of
corporate tax breaks: Over $410 million a
year.
MEASURE 97 WAS BROUGHT TO
YOU BY UNIONS!
(Guilty as charged.) It started with the
teachers union Oregon Education Association
(OEA) and the state workers and home care
workers union Service Employees Local 503.
Their members and their member dollars
helped get Measure 97 on the ballot. Each of
those unions also contributed $750,000 to
the campaign to pass the measure. Since
then, they’ve been joined by 21 other labor
organizations — public sector unions like
Amalgamated Transit Union and American
Federation of Teachers, but also private sector
unions like Steelworkers, Bakers, Carpenters,
Nurses, Communication Workers, and the
state’s biggest private sector union, United
Food & Commercial Workers Local 555. The
Oregon AFL-CIO labor federation has
endorsed the measure, and so has the union-
backed Oregon Working Families Party. And
when millions started to pour in from nation-
al corporations to oppose the measure, the
union movement stepped up to contribute
millions to support it, led by Oregon AFSCME
and the national affiliates of OEA and SEIU. So
far, the unions and their allies have raised
over $10 million. Why are all these unions
supporting Measure 97? Because it will be a
game-changer for Oregon, ensuring schools,
health care and senior services all Oregonians
can benefit from and be proud of. And
because it’s the best chance in a generation to
create national momentum toward getting
big corporations to pay their fair share.
Could Measure 97 accidentally get
Oregon’s roads in order?
Oregon’s state constitution says
revenue from taxes on motor ve-
hicle fuel — “any tax levied on,
with respect to, or measured by
the … sale … of motor vehicle
fuel” — shall be used exclu-
sively for construction, repair,
and maintenance of public high-
ways, roads, streets and roadside
rest areas. Measure 97, a pro-
posed statute on the November
ballot, doesn’t create a motor
vehicle fuel tax. Technically it
increases the corporate mini-
mum income tax, but it calcu-
lates the minimum tax based on
2.5 percent of a corporation’s to-
tal annual in-state sales over $25
million. So what happens when
the sales in question are sales of
motor vehicle fuel, like with
Chevron, Shell and the other gas
companies?
The Measure 97 campaign
says it would still be considered
a corporate minimum income
tax, not a motor vehicle tax in
that case. And the measure itself
is very clear that all the revenue
it generates is to provide addi-
tional funding to public early
childhood and K-12 education,
healthcare, and services for sen-
ior citizens — not roads.
But State Sen. Brian Boquist
(R-Dallas) asked the Legislative
Counsel to look into the consti-
tutional question, and on Aug.
30, the Legislature’s lawyers is-
sued an opinion: To the extent
the tax is calculated based on
motor fuel, those monies — es-
timated at $250 million a year
— would have to be spent on
roads. The legal opinion is non-
binding, and ultimately it could
be for the courts to decide.
But State Sen. Michael Dem-
brow (D-Portland), said $250
million would make a pretty
good start on a robust trans-
portation funding bill.
“From my perspective, that’s
not a bad place to be putting
some money,” says Dembrow.
“Certainly it’s a top business pri-
ority for us to be investing in.”
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