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Oregon: Governor calls special session

The Oregon Legislature is scheduled to meet Friday Dec. 14 at the call of the governor. The governor explained that the purpose of the session is to pass legislation to allow the governor to negotiate a freeze of tax policy for any business creating 500 jobs and spending at least $150 million in capital improvements in 5 years. The duration of the policy freeze will be negotiated by the governor in each case. This appears to be a concern over the potential change in the single sales factor legislation that passed in 2005. Under the single sales factor, corporations who have high payroll and property value in Oregon, benefit by using only "Oregon" sales to determine corporate tax liability. Prior to the change in tax law in 2005, corporations used payroll, property value and sales to determine Oregon corporate tax liability.

The Oregon Constitution requires each class of taxpayer to have tax equally. This statute would apparently create a new class of taxpayer. The reason given by the governor for this extraordinary action is Nike's desire to know what their future tax liability will be when making a large expansion in Oregon. This is similar to the arguments used by Facebook to get legislation enacted last session regarding their tax status in Oregon. The hurried nature of this session appears to be based on taking advantage of the republican membership in the House. Republicans are more likely to support this measure, and their numbers decrease by four seats in January. For more information, please contact Sandy Larson at more

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