The average Oregonian might rightly ask, “The CAT? Why all the fuss?”

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The average Oregonian might rightly ask, “The CAT? Why all the fuss?”

InsideCapitolDome
Twenty-five cents for every $100 in sales. That is how much a company in the construction industry with $100 million in Oregon sales would pay under the commercial activities tax (CAT) being discussed in the legislature. Those 25 cents would be paid by the company, reducing the profit passed along to the owners and taxed on their personal income taxes.

The average Oregonian might rightly ask, “The CAT? Why all the fuss?”

Twenty-five cents for every $100 in sales.

That is how much a company in the construction industry with $100 million in Oregon sales would pay under the commercial activities tax (CAT) being discussed in the legislature. Those 25 cents would be paid by the company, reducing the profit passed along to the owners and taxed on their personal income taxes.

Compare that to what that company’s employees are paying. The average individual taxpayer in Oregon pays 24 times that amount — $6 on every $100 of income — in personal income taxes.

Or take the case of an auto dealer with $35 million in retail sales a year. That dealership would pay 24 cents on every $100 in sales, compared to the $6 that the employees pay.

Or consider a retail business with $1 million in sales per year — a sales goal many small business owners on Main Street would love to hit. That business would pay two cents in taxes on every $100 in sales. The average Oregon taxpayer pays 300 times that — $6 — in personal income taxes on every $100 of income.

The average Oregonian might rightly ask, “The CAT? Why all the fuss?”

 


This post was originally published on www.blueoregon.com on June 20, 2017. The original post can be found at http://www.blueoregon.com/2017/06/commercial-activities-gross-receipts-tax-what-fuss/.

Charles Sheketoff

Charles Sheketoff

Chuck Sheketoff is a founder of the Oregon Center for Public Policy and former Executive Director. Incorporated in 1995, the Center was launched with Chuck as its first executive director after Chuck received the "public interest pioneer award" from the Stern Family Fund in September, 1997. Prior to starting the Center, Chuck lobbied the Oregon legislature on tax policies and on human services programs' policies and budgets on behalf of legal aid clients (1992 to 1996) and the low-income clients of the Oregon Law Center (1997).

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