A coalition of House and Senate Republicans put forth a package of tax-savings bills to help middle class and working families in Oregon. Entitled the “Keeping Oregon Affordable for Middle Class Families” package, the six bills attempt to put more money back in the pockets of families, seniors, and small businesses who disproportionately are paying for the skyrocketing costs of government.
“In the face of record revenues, it’s become clear that the cost of government is being borne by working families, seniors, and those small businesses who are being mandated to do more by the legislature, but still have a higher effective tax rate than the largest corporations in the state,” said Rep. Cedric Hayden (R-Fall Creek). “We believe this package will help Oregonians keep more of their hard-earned money to pay for the most pressing budget items Oregon families face each month.”
Senator Tim Knopp (R-Bend) is the chief sponsor of Senate Bill 1029. The measure will bring down the tax rates to 4% for the lower quintile tax brackets of workers earning less than $50,000 for a single filer or $100,000 for a joint filer. The current progressive tax structure will remain in place for those earning more than the proposed base income rates in SB 1029. “Oregon has some of the highest tax rates for low- and middle-income families. Those families haven’t recovered equally compared to higher-income earners since the recession. By lowering the tax rate for these families, we’ll give them a needed pay raise while bolstering the economy ahead of a predicted economic recession,” Sen. Knopp stated.
A mom of three, Rep. Shelly Boshart Davis (R-Albany) is the chief sponsor of House Bill 3410, a measure that would create an Oregon Child Tax Credit of $1,000 per child up to 18 years old, with that credit being refundable if the family is 150% or less of the federal poverty line. “With three kids, I can tell you how much families struggle to make ends meet. Rather than creating more high-cost, bureaucratic state programs to try to help families with things like daycare costs, letting families keep more of their tax dollars is the most efficient and economical way to help working families keep their heads above water,” Rep. Boshart Davis said.
Rep. E.Werner Reschke (R-Klamath Falls) has both a university and a community college in his district. One of the things he hears most is from students about how much debt they’re taking on to achieve a higher education. House Bill 3400 would provide a $1,000 deduction of student loan interest from state income taxes for a single filer with up to $75,000 of income; $2,000 for joint filers with up to $150,000 income. “The fact is, students are debt servicing through student loans things like high PERS costs and public employee healthcare plans. It also takes an Oregon student an average of six years to graduate, further driving debt loads. If we’re not going to do systemic cost reforms, then Oregon students carrying crazy amounts of crushing student loan debts deserve a break,” Rep. Reschke explained.
With news reports already showing negative impacts of rent increases caused by Senate Bill 608, the statewide rent control bill, Rep. David Brock Smith (R-Port Orford) is proposing House Bill 3402, a “Renters Tax Deduction” similar to the mortgage interest deduction for homeowners. “SB 608 is already driving rent prices higher as an unintended consequence. The reality is, until the state does something about the supply-side of housing, rent prices will be higher than other states with similar median family incomes. One way we can combat the high price of rent is to let the 40% of Oregonians who are renters have a comparable rent deduction off their personal income taxes,” Rep. Brock Smith said. He noted a recent Daily Mail article showing that Oregonians have the least amount of take-home pay compared to the rest of the nation. “You can’t have some of the highest rent prices while taking home the least amount of money in your paycheck. House Bill 3402 will help create some balance for renters.”
Another concern for the six lawmakers is the tax inequity between large corporations and small businesses. Rep. Daniel Bonham (R-The Dalles) hopes to level the playing field with House Bill 3421*, a measure that would reduce the rate of taxes small businesses pay to one-percent less than C-corporations. “The voters in my community who run small businesses are frustrated that the Legislature keeps leveling new employer mandates and tax increases which disproportionately impact small businesses while ignoring the fact that small business owners who pay their business income on their personal income tax return having a higher tax rate than the biggest corporations and publicly-traded companies in Oregon,” Rep. Bonham stated.
The last measure in the package would require voter approval. Sponsored by Rep. Cedric Hayden, HJR 25 would ask voters whether to approve a constitutional "Senior Property Tax Freeze" for homeowners over the age of 67. The measure would lock in property taxes for the primary residence at the rate an Oregon senior citizen was paying on their 67th birthday. “The crisis on the horizon is how we keep seniors in their homes. The most affordable way to ensure seniors age in place is by pausing the rising cost of property tax increases so that their retirement income can appreciate faster than their tax bill,” stated Rep. Hayden.
“This last tax year saw senior citizens facing property tax bills higher than the legislature just capped rent increases in SB 608. Property tax increases many fixed-income seniors face are actually higher than some of the rent increases landlords were accused of implementing. HJR25 acknowledges that at some point, our seniors have paid their ‘fair share’ and are entitled to age in place without being forced out of their home due to double-digit yearly property tax increases.” Hayden highlighted how states like Hawaii have senior homestead exemptions reducing assessed values, but how a property tax freeze will provide a senior with budgeting predictability. “Every year, they’ll know exactly how much taxes they owe, while still making a high enough tax payment to contribute to essential school, public safety, and city services.”
All the bills in the package deal with taxation and are anticipated to go to the respective Revenue or Rules committees in each chamber, which can hear bills until Sine Die. Rep. Hayden, who is coordinating the package, said he believes each of the six bills address a real income inequity issue for lower- and middle-income Oregonians, and collectively, highlight just how much of Oregon’s government budgets are being shouldered by seniors and working families.
“We really need to ask ourselves, with record revenues, if growing new government programs is the solution long term, or if Oregonians would be better off and need fewer government programs if they simply could keep more of the income they earn. This is a conversation we should be having now, ahead of the next recession, before families and small businesses are impacted by the threats of cuts to expensive services they could pay for themselves if they just had more money in their checkbooks.”
The six Republicans are seeking cross-party sponsorship in their respective chambers for the tax package. “Helping working families stay afloat and keeping seniors in their homes should be something every Oregonian lawmaker can support,” Sen. Knopp said.
Source: Representative Cedric Hayden