Taxation group praises Oregon's 'effective business tax'

Portland Business Journal
April 20, 2011

An Ernst & Young study, conducted for the Council on State Taxation, reports that Oregon’s business tax structure ranks better than all but one state in terms of low rates.

The study found that Oregon has the nation’s second-lowest “effective business tax rate” for new investments. Only Maine has what the council called a more “competitive” tax structure.

The taxation group’s study compared state and local business taxes incurred by corporations investing in new facilities or expanding their current structures. The analysis takes into account the state tax structures in place in 2009 and changes scheduled to become law through 2014.

Oregon’s 3.8 percent rate ranked behind Maine’s 3 percent rate and ahead of the 4.4 percent rate levied in Ohio.

New Mexico and the District of Columbia tied for the worst “effective business tax rates,” at 16.6 percent.

The study’s authors noted that:

The Oregon Center for Public Policy, the Silverton-based research group that touted the study Wednesday afternoon, maintains the study proves the state shouldn’t reduce business tax rates or increase corporate tax subsidies.

“Oregon business taxes are already low, and the loss of revenue would only harm Oregonians and the state’s business climate,” said Chuck Sheketoff, the group’s executive director.

Sheketoff also maintains the study proves the state shouldn’t tinker with 2010’s Measure 67, which raised Oregon’s minimum corporate tax rate. Some legislators have proposed the measure be repealed or weakened.

About 600 corporations take part in the Council of State Taxation, including Nike Inc., Intel Corp. and U.S. Bank.

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