Oregon Measure 118 Explained
This article provides a comprehensive overview of Oregon Measure 118, also known as the Corporate Tax Revenue Rebate for Residents Initiative. It covers the measure's key provisions, including the proposed corporate tax increase and rebate program, as well as arguments from supporters and opponents, and potential economic impacts on Oregon residents and businesses.
Contents
Oregon voters will face a consequential decision in November 2024 as they consider Measure 118, officially titled the “Corporate Tax Revenue Rebate for Residents Initiative.” This groundbreaking ballot measure proposes a significant overhaul of the state’s corporate tax structure, coupled with an ambitious plan to distribute the resulting revenue directly to Oregon residents. At its core, the measure aims to address income inequality and provide financial support to all Oregonians by tapping into the profits of the state’s largest corporations.
Key Provisions of Measure 118
Measure 118 introduces two major changes to Oregon’s tax and revenue system:
1. Increased Corporate Taxation
The measure would impose an additional 3% tax on annual Oregon sales exceeding $25 million for both C corporations and S corporations. This tax would be applied on top of the existing minimum tax structure. For example:
- A corporation with $35 million in Oregon sales would pay an additional $300,000 in taxes
- A corporation with $100 million in Oregon sales would pay an additional $2,250,000 in taxes
2. Universal Rebate Program
The revenue generated from this new tax would be distributed among eligible Oregon residents in the form of annual rebates. To qualify, individuals must reside in Oregon for more than 200 days in a calendar year. Initial estimates suggest that the rebate could amount to approximately $1,600 per person annually, starting in 2026.
Projected Economic Impact
The Oregon Legislative Revenue Office has provided a range of potential rebate amounts:
- For 2026: Between $1,035 and $1,286 per person
- For 2027: Between $1,442 and $1,790 per person
These projections consider potential variables in implementation and economic responses to the measure.
Arguments in Favor
Supporters of Measure 118 argue that it will:
- Significantly reduce poverty rates among Oregon’s most vulnerable residents
- Boost local economies through increased consumer spending
- Create a more equitable tax system by ensuring large corporations contribute a fair share
- Provide a universal benefit, avoiding the stigma and administrative complexities often associated with means-tested programs
Arguments Against
Opponents of Measure 118 raise several concerns:
- Potential negative impact on businesses, possibly driving some out of Oregon or forcing closures
- Possible price increases as businesses pass on additional tax costs to consumers
- Concerns about the impact on the state budget, particularly if the measure leads to reduced corporate tax revenue in other areas
- Implementation challenges, especially in ensuring the rebate program doesn’t interfere with existing benefits
Political Landscape
The measure has garnered both support and opposition across the political spectrum. Notable opponents include Governor Tina Kotek (D), who expressed concerns about the measure’s potential impact on the state budget and essential services for low-income families. Major corporations like Intel and Nike have also voiced opposition.
Comparison to Other States
If passed, Measure 118 would make Oregon one of the few states in the nation to implement a form of universal basic income. Currently, only Alaska offers a similar program, funded by oil extraction taxes, with an average payment of $1,200 in its 42-year history.
