Ferrioli Warns of Sales Tax Initiative


On Monday my fellow legislators and I will have the opportunity to hear the results of a long-awaited study outlining the potential effects of the largest tax increase in Oregon history. Initiative Petition 28, which was proposed by a cohort of liberal activists calling themselves Our Oregon, would bring in an estimated $5 billion every two years by imposing a new tax on gross receipts from the sale of consumer goods in Oregon.  Although this tax, according to Our Oregon, is supposedly targeted at large and out-of-state businesses, the cost will inevitably be passed on to consumers and small businesses. Prices will rise and jobs will be lost.

 What Our Oregon is proposing is a 2.5 percent tax on sales, with no exemptions for basic necessities including food, medicine, clothing, and electricity. Economists say the so-called gross receipts tax has a cascading effect. Not only will the grocer pay 2.5 percent, but the wholesaler will pay 2.5 percent, as will the manufacturer. Consumers will ultimately pay the 2.5 percent tax at each step, resulting in cost increases of as much as 7.5 percent. Low-income families, those living in rural areas, and seniors on fixed incomes would be hurt the most.

             State economists in the Legislative Revenue Office have worked for months to put together a report predicting what impact this tax will have on job losses, revenue, and other economic factors. IP 28 qualified for the ballot on May 17th, and on May 23rd we will have our first in-depth look at the harm this measure might have on Oregon consumers. Get ready for what will likely be the biggest ballot measure fight in Oregon history, with potentially thousands of jobs at stake for Oregonians.


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