January 27, 2010

Oregon voters say yes to tax increases to save schools and public services

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rita_hibbardwebIn a vote closely watched by other states with budget woes, Oregon voters chose to impose corporate tax hikes and an  income tax increase on the wealthiest of taxpayers to prevent mammoth cuts to public education and other state services. It had been eight years since Oregon voters last approved a statewide tax increase, and it was greeted with relief by education and public service advocates, The Oregonian reported.

The double-barreled victory is the first voter-approved statewide income tax increase since the 1930s. Other states, facing similar budget woes, are watching the outcome closely because Oregon, after all, is a state that capped property taxes and locked a surplus tax rebate program into the constitution.

The last time voters approved a tax increase was 2002, when they agreed to bump up tobacco taxes to help pay for the Oregon Health Plan. Voters rejected income tax increases twice in recent years.

Not only did the tax measures pass Tuesday, but they passed easily — by 54 percent. Multnomah County — home to Portland — went heavily for the measures, but support was also strong in more conservative parts of the state.

Campaign ads by supporters highlighted banks and credit card companies and showed images of well-dressed people stepping off private jets. They also hammered on the $10 minimum tax that most corporations have paid since its inception in 1931.  Those messages helped counter warnings by opponents that the taxes would lead to job losses, worsening the state’s 11 percent unemployment rate, and prompt wealthy residents to move elsewhere.

“They did a great job of pounding, ‘It’s only $10,'” said Bob Tiernan, chairman of the state Republican Party. “We got swamped by the union money.”

In Washington state, some lawmakers grappling with a $2.6 billion budget gap and talking about taxing muffins and soda pop no doubt are looking longingly south this morning. Democratic leaders — including Gov. Christine Gregoire — have talked about deep budget cuts, and suspending or modifying Initiative 960, which requires a two-thirds vote of the Legislature or voter approval to raise taxes.

Gregoire has proposed cuts that would gut services to the poor, eliminate all-day kindergarten and eliminate health insurance for thousands of low-income families. But she is looking for ways to avoid many of the most draconian of those cuts. A state income tax is said to be off the table, as it is every year. Perhaps lawmakers here should study the Oregon vote, and how advocates of protecting services for the most needy got their victory.

It’s only $10, after all. That’s what Oregonians decided in voting to approve higher corporate and income taxes. What would the Washington version of that slogan be?

One thought on “Oregon voters say yes to tax increases to save schools and public services

  1. Perhaps you should wait to see the economic impact of the Oregon tax increases on jobs and the economy before you advocate something similar for Washington state!