Oregon voters are soon expected to make a decision regarding a historic universal basic income program that aims to distribute approximately $750 annually to each state resident.
This initiative, likely appearing on the November ballot, hinges on increasing corporate taxes to fund the program. With adequate signatures gathered to place the measure on the ballot, both proponents and opponents are actively preparing for the campaign.
Proposed Tax and Benefits
- Tax Rate: 3% on corporations’ sales in Oregon exceeding $25 million.
- Distribution: Equal distribution of the tax revenue to all Oregon residents, regardless of age.
- Implementation Date: January 2025, pending voter approval.
Anna Martinez, a key advocate from Portland and a member of the Oregon People’s Rebate group, highlights the necessity of these funds for families to cover basic expenses.
She insists the additional $750 can significantly impact residents’ ability to afford essentials like groceries and rent.
The organizational structure indicates that the Department of Revenue will oversee the distribution, allowing residents to receive the money either in cash or as a refundable tax credit.
Additional Funding Utilization
The proposal clarifies that any leftover funds will support:
- Services for senior citizens.
- Health care.
- Public early childhood education.
- Public K-12 education.
Financial Backing and Opposition
Oregon People’s Rebate has seen substantial financial endorsements, notably from out-of-state supporters of universal basic income. Contributions include:
| Contributor | Amount |
|---|---|
| Jones Holding LLC | $425,000 |
| Jones Parking Inc. | $95,000 |
| Gerald Huff Foundation | $90,000 (combined with other sources) |
Despite Martinez’s reassurances of the beneficence of these contributors, Oregon’s business community expresses significant concerns.
Oregon Business and Industry and the Tax Foundation argue that heightened corporate tax could be detrimental. They suggest businesses may relocate to evade increased taxes, thereby harming the local economy.
The opposition asserts that the tax would disproportionately affect corporations with high sales but minimal profits, complicating their financial viability.
Current Corporate Tax Structure
| Tax Type | Rate/ Description |
|---|---|
| State Excise Tax | 6.6% on income below $1 million; 7.6% on income above $1 million |
| Minimum State Tax | $150 to $100,000 based on sales |
| Corporate Activity Tax | 0.57% on commercial activities above $1 million |
This established tax system already generates substantial revenue, making up approximately 10.3% of the state’s general fund for the 2021-2023 biennium.
Potential Impact
The proposed excise tax increase to 3% on gross sales above $25 million is unprecedented and aims directly at businesses with substantial in-state sales.
Critics worry that such high taxes could drive companies to move operations out of Oregon, resulting in economic repercussions. The Tax Foundation report specifically notes that businesses with narrow profit margins would face severe burdens under this new tax structure.
Martinez remains unfazed by business opposition, arguing that corporations historically resist paying equitable taxes while ordinary Oregonians manage on much tighter margins.
Her stance emphasizes a perceived disparity in financial responsibility between large corporations and individual residents.
Significance
This universal basic income proposal represents a significant policy shift with both economic and social implications. If approved, it would be a pioneering model in the United States, presenting a blend of economic redistribution and support for local economies.
The upcoming vote in November will determine whether Oregon will take this bold step toward implementing a universal basic income funded by increased corporate taxes.
