PORTLAND, Ore. (KOIN) — Could a proposed corporate tax cost Portland one of its biggest icons?
Powell’s Books is the largest new and used bookstore in the world, but its owner says she’s worried a measure on the November ballot could make it a thing of the past.
Ballot measure 97 is being called the “biggest tax change” in Oregon history. It would levy a 2.5% tax on businesses’ gross sales over $25 million.
Emily Powell told KOIN 6 News the tax would be “extremely damaging” to her family’s namesake business.
“We are a business that’s challenged every year to figure out how we are going to make our way,” Powell said. “If I knew how to find this kind of cost savings every year I would have found it already.”
Powell said the proposed tax would affect more than the store’s direct revenue.
“Pacific Power has said they’ll pass on the tax in a price increase and so our power bills are going to go up as well,” she explained. “It’s very likely our distributors will charge us more, our margins will go down.”
“Mind boggling” and “scary” are words she used to describe some potential effects the ballot measure could have on her business. She said the tax could force her to shorten employees’ hours and cut service in a way that doesn’t impact sales.
When asked about the worst case scenario — having to close the bookstore — Powell said she “prefers not to think about [it] but it is certainly keeping [her] up at night.”
“The scale of the problem is so large that we don’t yet have an answer,” Powell said.
Advocates of the corporate tax tout it as a way to help fund vital services in Oregon.
“By raising the corporate minimum tax for some of the world’s largest corporations, we’ll be able to fund the services Oregon families need most: early education, K-12 education, health care, and senior services.” – Yes on 97
Powell said she also worries about issues with education and health care that affect many Oregonians, but called the proposed tax a “bad idea” to help a good cause.
The Oregon Business Association shares Powell’s sentiments on the measure.
“…this unprecedented new tax would increase costs for working families and consumers and would hurt businesses in our state without any guarantee the money will make it into our classrooms or help our schools.” – OBA Online
An analysis by the non-partisan Legislative Revenue Office found ballot measure 97 could actually cost Oregonians more in the long run. The study determined the corporate tax would result in the loss of thousands of private sector jobs and increase the tax burden on Oregon families by $600 per capita per year.
“Because this would be a new tax on gross sales — not profits — businesses would be required to pay the tax on their total revenues, regardless of whether they make a large profit, a small profit or no profit at all,” according to the OBA. “That would mean that many employers would have to raise prices or cut jobs, or both.”
Paul Warner with the Legislative Revenue Office said the tax would dampen income, employment and population growth and lead to higher consumer prices and wages.
It would also bump Oregon from the 28th highest-taxed state to the 20th.
Powell, who doesn’t usually take a stance on political issues, felt compelled to speak out against the measure, which she calls “detrimental” to Oregon businesses.
Read Friday’s edition of the Portland Tribune for more on this story