- Oregon residents will soon vote on a corporate tax increase to give them a universal basic income.
- Businesses have spent millions to oppose the 3% tax on corporate sales over $25 million.
- Both Democrats and Republicans say the measure could harm the state budget and essential services.
Oregon businesses are spending big to oppose a ballot measure that would tax corporations and give residents $1,600 a year in a rebate program that is similar to a universal basic income.
And lawmakers, both Democrats and Republicans, seem to agree. They say the ballot measure is riddled with problems and could crater the state's budget.
Whether the state adopts Oregon Measure 118, however, will ultimately be up to the voters.
Also called the Oregon Rebate, the measure would increase the state's minimum corporate tax rate by 3% after a company makes $25 million in in-state revenue. Then, it would distribute that money to all Oregon residents, including minors and dependents, who have lived in the state for at least 200 days.
The rebate "levels the playing field" for Oregonians, over 170,000 of whom signed a petition to get the measure on the November ballot, the Oregon Rebate website says.
California donors have been the largest source of funding for the Oregon Rebate PAC, which has raised hundreds of thousands of dollars in support of Measure 118, state filings show. As for the opposition, Oregon businesses have collectively raised $9.3 million to fight it.
An unusual show of bipartisan opposition
Democratic Gov. Tina Kotek told the Willamette Week in July that the ballot measure "may look good on paper, but its flawed approach would punch a huge hole in the state budget and put essential services for low-wage and working families at risk."
A united front of state Democratic legislators — who are more likely than their conservative counterparts to support the kinds of basic income programs that have gained popularity nationwide — is also fighting the ballot measure. They fear it could hamper job growth and "cause cuts to critical services like road maintenance, fire fighting, and addiction recovery," the state's Senate Democratic Leadership Fund said in a statement in August.
The state's Republican Party called the measure "misleading, misguided, and harmful to Oregonians and to Oregon small businesses" in a press release on Saturday.
"If Measure 118 passes, the $1600 'rebate' each taxpayer would receive would be dwarfed by the necessity of paying even higher prices for groceries, medicine, utilities, gasoline, clothing and just about everything else Oregonians struggle to afford already," the party said. It added that the rebate could drive businesses out of Oregon.
The Oregon Legislative Revenue Office, a nonpartisan entity, released a report this month that found low-income rebate recipients could be disqualified from receiving aid from federal programs like Temporary Assistance for Needy Families and Medicaid.
"If there were no changes and Measure 118 becomes law, that just creates a $1.3 billion hole in the general fund," Chris Allanach, the state's Legislative Revenue Officer, told The Oregonian. "The Legislature could change it, but that has its own issues."
Despite months of opposition from politicians and business leaders, Antonio Gisbert, the petitioner behind the ballot measure, has maintained that the rebate would be net neutral.
"In short, General Fund dollars do not fund the rebate, all implementation and related costs are paid for by the new revenue. The reduction in poverty decreases demand on services and the increased economic stimulus will boost the state's economy and lead to increased tax receipts and the General Fund resources," Gisbert told Business Insider in an email in August. He did not immediately respond to a request for additional comment.
The fight over UBI
Universal basic income programs offer recurring, unconditional payments to people regardless of their economic status. Measure 118 would make Oregon the second state in the United States to have some form of a statewide universal basic income, joining Alaska. The Alaska Permanent Fund distributes annual funds to all Alaskans.
Proponents of these programs say they can help poor residents pay for basic needs and stimulate the economy, while their opponents — most commonly conservative lawmakers — argue that they are closer to "socialism" and offer payments with no merit.
In his previous comments to Business Insider, Gisbert said he remains optimistic voters will support the measure in the general election.
"It kind of does seem a little bit like some of these elected [officials] are more beholden to corporations and corporate interests than they are to the interests of everyday Oregonians," Gisbert said. "We are super committed in instituting some degree of corporate tax justice."
Gov. Tina Kotek did not immediately return requests for comment from Business Insider.