Tax changes are always a prickly issue and Oregonians will have their say on the matter at both the federal and state levels next month. The former refers, of course, to the Presidential election on November 3. Less widely known is the latter, a vote on payroll tax to fund several transportation infrastructure projects.
There are fine arguments for and against tax increases. Politicians have to consider whether the boost in tax revenue is worth the suppression in liquidity of the people and businesses that pay it.
Why would someone work harder to earn more only to give it to the government? They could just stay home and trade cfds for the additional revenue instead.
The Arguments
The national news in the past week has been peppered with celebrity opinions about super high taxes. Rappers 50 Cent and Lil Pump came out in opposition to measures that would effectively put them in the over-60% tax bracket. 50 Cent even complained that the changes would make him ’20 Cent’.
Locally, the 0.75 % payroll tax which has been proposed has met with similar opposition. It has been argued that the change would catapult the state from its current 40th position in tax burden to 19th.
That does seem to be a drastic escalation. However, it will also net the state of Oregon an estimated $1.1 billion every year. While business owners may argue that the increased tax burden would make it less likely that they reinvest in new ventures and expanding hiring, the state’s logic diverges.
Their position is that the projects themselves initiate a hiring and spending boom. Proponents also say that with the increased connectivity will come greater access to jobs for the community at large. It has also been said that these infrastructure developments are long-term additions to the city with immeasurable value.
Learning from Mistakes?
California has already toyed with its tax rates and the results have not been overwhelming. It is currently seeing an exodus of wealthier residents to such an extent that there are concerns that total tax revenue will actually fall. Food for thought.
