Historic vote in Oregon to raise taxes rather than cut education

It is likely that Georgia will move to shorter weeks or a shorter school year before it raises taxes.

Not every state feels the same way, as this story today from the Register-Guard in Oregon shows: (I am only reprinting a short piece of the story. But do read the entire thing.)

By David Steves

Oregon voters delivered historic approval Tuesday for a pair of tax increases after a campaign that assured Oregonians they could protect schools and other programs by requiring wealthy individuals and big corporations to pay more.

With 91 percent of the votes counted, Measures 66 and 67 each were passing with 54 percent and 53 percent approval.

Measure 66 raises income taxes on the top 3 percent of filers and Measure 67 boosts business taxes. Both tax increases were approved by the 2009 Legislature but forced to the ballot by opponents’ signature drive.

Oregon House Speaker Dave Hunt called the results “a win for Oregon kids,” whose schools will not face the 5 percent cut in state spending they would otherwise have confronted. The Gladstone Democrat acknowledged that Tuesday’s vote broke from Oregonians’ history of rejecting general tax-raising measures, which were similarly promoted as ways to preserve vital services.

The core difference was these measures were crafted to hit the bank accounts of only the most well-off individuals and the deepest pocketed big corporations — not all Oregonians and businesses across-the-board, as past tax measures have proposed.

“These are asking people who are doing well — even in this economy — to pay a little bit more,” Hunt said. “I think that’s what made the difference.”

The last time Oregon voters approved a general tax increase was in 1930, when they adopted the state’s income tax.

The approval of the two tax increases prompted ominous warnings of economic woe by opponents.

“I think the voters made a huge, huge mistake,” said Oregon Republican Party Chairman Bob Tiernan. “We’re going to have more businesses leave this state and we’re going to have a lot more businesses who are never going to come here.”

Measure 66 raises the marginal income tax on personal income above $125,000 for individuals and $250,000 for couples. It’s projected to pull in $472 million for the current two-year budget cycle.

Its approval means Oregon will have the highest state capital gains tax in the United States and will be tied with Hawaii for the highest state income tax in the country. But when all taxes including sales taxes (which Oregon does not impose) are accounted for, Oregon’s overall per-capita tax burden will be the 34th lowest — up two places from 36th lowest before the two measures were approved.