Elsewhere, the headline from yesterday’s referendum results reads “Oregon passes tax boost on wealthy, corporations.” But there’s no such thing as a tax on corporations, and states that pass taxes on the wealthy soon find themselves with fewer wealthy people.
There’s no such thing as a tax on corporations because the money has to come out of someone’s pocket: from shareholders in the form of lower returns, from employees in the form of lower wages, or from customers in the form of higher prices. Liberals seem to think it’s OK for shareholders to lose money, ignoring the ripple effects on investment, and to fantasize that employees and customers won’t get stuck with the bill, ignoring reality.
The most egregious part of the new law is that Oregon will now tax companies based on their revenues in the state even if they don’t make a profit. The state will tax residents earning $125,000 a year at rates that even tax-happy California reserves for millionaires.
Oregon already was not what you would call a low-tax state. Even before Tuesday’s vote it had the 15th-highest corporate tax rate in the U.S., which is the same thing as the 15th-highest corporate tax rate in the world, as well as one of the highest individual income tax rates.
On the other hand, maybe Oregonians are tired of all those Californians moving northward to escape their own high taxes.
Keep all of this in mind the next time someone suggests that Atlanta should view Portland as some kind of model.