The governor is out for tax reform, and politicians are focusing not on modifications to Oregon income tax but on implementing a sales tax. There are very good, practical reasons to do this; and those are the same reasons why they should not be implemented.
While many have taxes removed from their paychecks, that doesn’t account for the total tax bill. There are many people who do not pay any income tax, and legally so. If you do not make any money or are so impoverished that your income isn’t subject to income tax, then you don’t pay it. There are also thousands of Oregonians who owe small amounts of income tax, and the Oregon Department of Revenue doesn’t pursue them because the cost of the pursuit is more expensive than the amount owed.
With a sales tax, money is collected up front, and it shifts much of the costs of collection over to the private industry. It is very hard for an individual to dodge a sales tax. Even those small money dead beats who don’t pay their un-pursued tax bills are forced to pay it when they pay for their goods. Sales tax is also easier to predict, based on the necessity of classifications of goods and population.
Your income on the other hand is something that can wildly fluctuate. Government officials hate it for that reason – because they cannot depend on it being consistent year to year. But that is also the very reason why personal income tax is entirely applicable to funding the State of Oregon government. Having your budget and income linked to the success of your work is called accountability. And accountability is at the heart of why Oregon has a tax problem. Many who oppose modification of the tax structure of the State of Oregon oppose it because they do not feel there is adequate accountability. There isn’t a link between the work being done and the prosperity of those who live in this State.
Oregon’s tax problem is about accountability. Address accountability first, then restructure.