ONTARIO – Oregon consumers may find that a single receipt tax on goods enters businesses that are now required to pay corporate income tax commonly known as CAT tax. The tax was passed by Oregon legislature in 2019 and was not labeled a sales tax and was intended for companies with total sales greater than $ 1 million per year. However, many business owners view it as a sales tax, and even Senator Lynn Findley, R-Vale, said in a telephone interview Thursday, “It’s a sales tax.”
It’s noteworthy that Oregon voters have turned down a sales tax several times over the years. Findley said he and his Republican colleagues “spoke against the bill for hours on the floor,” but it ultimately passed.
Robin Maxey, Public Information Officer for the Oregon Department of Revenue, confirmed Friday that corporate income tax is known as a modified tax versus a gross income tax, with the latter taxing a company on every dollar that comes through its door, not necessarily profits.
The change tax, he said, comes with “some caveats that allow some deductions” from the CAT tax, such as the ability to deduct the entire labor cost.
For chain companies, Maxey said, the tax is more complicated because they are known as a “unified group” that has its own rules.
It is noteworthy, however, that the CAT tax “does not take into account whether a company can or cannot”. [add a tax onto a sales receipt], or how they do it, ”says Maxey.
The legislature did not include in the law how to list the tax.
“You were just fooled”
“I hate the tax,” said Findley. “It’s regressive and multiplies for providers. It’s a terrible tax. “
He said the Democrats thought the tax would be “eaten up by producers and retailers,” but instead those costs would be passed on.
Additionally, Findley said that some products can be taxed up to seven times before they are ultimately consumed. And there are few exceptions, but these include marijuana, tobacco, and alcohol, which already have their own tax.
“It’s terribly progressive, doubling up and moving down the chain, and all consumers don’t know much about it,” he said. “You were just fooled.”
Findley provided an agricultural example of multiply taxed goods.
“A farmer grows a product to sell a bale of hay and he sells that hay to Tillamook Dairy and they pay a CAT tax, then they sell the milk and pay taxes every time,” he said. “But when a farmer sells to a cooperative or somewhere outside of the state, he doesn’t pay that tax.”
“It’s just bizarre, absolutely bizarre. It’s a pure Oregon tax, ”he said. “As such, a farmer can no longer sell his goods in the state.”
While this may not have an impact on Malheur County’s producers, who are already sending a lot of trade to Idaho, the District 30 Senator said the rest of the state may not turn out well.
“It’s an incredibly complex network that makes a billion dollars a year,” he said.
And Findley pointed out that the tax isn’t really doing what it’s supposed to be.
“That money was theoretically used for the Joint School Fund and student achievement, but what happened to these programs, instead of the General Fund paying $ 7 billion for education, it is paying less because of the compensation from CAT,” he said. “Instead of a blessing … it doesn’t have the desired effect of raising money for education.”