Dudley: Tax cut could boost Oregon business climate
Dudley: Tax cut could boost Oregon business climate
GOP candidate for governor does not stray very far from his familiar script
By Steve Law – Portland Tribune - Pamplin Media Group, Oct 6, 2010
GOP gubernatorial candidate Chris Dudley shakes hands with supporters at this year's Oregon State Fair in Salem. Dudley stuck to his familiar message of a capital gains tax cut and reductions in government pensions during a meeting with the Portland Tribune editorial board.
Chris Dudley is proving more adept at staying “on message” in his campaign for Oregon governor than he was at shooting free throws for the Portland Trail Blazers.
The GOP gubernatorial candidate demonstrated that skill once again Monday, spending more than an hour with the Portland Tribune’s editorial board, answering questions on a wide range of topics.
Six days after the lone televised debate of the general election campaign, the novice politician stuck to the campaign themes and “talking points” that have carried him to a slight lead in most polls over former two-term governor, Democrat John Kitzhaber.
On taxes:
Dudley continued to stress a familiar theme, the need to slash Oregon’s capital gains tax, which he said would send a “psychological” message that Oregon welcomes investments. As long as Oregon has the nation’s highest capital gains tax and Washington has no capital gains taxes, we will keep seeing high-rolling businessmen move to Clark County to escape taxes, Dudley said. Just that day, Dudley said, he’d spoken with a company with 24 shareholders, apparently about to enter a major deal making them subject to paying significant taxes on their capital gain. “They say five of them have moved across the river this year,” Dudley said, though he wouldn’t divulge the company name.
Dudley was asked about Oregon’s past failed attempt to exempt business owners from paying capital gains taxes if they reinvested profits from sale of their company into new Oregon assets. Dudley was aware of the history and had a quick comeback. “Part of the reason was all of the restrictions it put in place,” he said.
That plan, pushed by the state’s leading business lobby, Associated Oregon Industries, and adopted by the Republican-controlled Legislature in 1995, was signed by then-Gov. Kitzhaber. But a 1999 state analysis found the program wasn’t leading to new jobs, and the tax break subsequently was dropped.
Dudley stuck to his insistence at last week’s debate that Oregon government finances won’t be more stable if the state added a sales tax. It’s been a long-held assessment by numerous economists and state revenue experts that Oregon state finances are more volatile than most states because we only have an income tax and property tax, and no sales tax.
Dudley again pointed to California as evidence that a sales tax won’t make Oregon’s system less volatile.
“Their volatility is not right with ours, but pretty darn close,” he said.
In any event, Dudley said, “that’s not the reason to do it (add a sales tax), just to diversify.”
Adding a sales tax or raising the property tax isn’t going to happen, Dudley said, so it’s not worth discussing.
Dudley has called for tax credits for businesses that hire unemployed people as a way to add jobs in a slow economy. When asked if there were other ways to restructure business taxes to yield more economic benefits, Dudley defended the state’s “kicker” rebates to corporations, which critics note mostly go to out-of-state businesses, merely because corporate tax collections top state projections.
He said the corporate kicker is “not a huge dollar amount,” and suggested that companies reinvest the proceeds in Oregon. Dudley added that it’s not fair to take away the corporate tax break just after the state enacted the Measure 66 and 67 tax increase package, which tapped money from businesses and high-income people.
