Opponents of the Oregon Legislature’s $800 million income tax surcharge submitted more than 147,000 signatures to election officials on Tuesday — almost three times the number of signatures necessary to put the tax increase to a vote in a February special election.
Petitioners needed 50,420 valid signatures to place House Bill 2152 — legislation authorizing the tax surcharge that lawmakers passed last summer to balance the budget — on the ballot. Election officials have until Dec. 9 to determine whether the petitioners have the required 50,420 signatures. Both supporters of the tax increase and opponents agreed that petitioners had probably collected the necessary number of signatures.
If enough valid signatures are recognized, HB 2152 would be put up for a vote in a Feb. 3 special election. A “yes” vote would uphold the tax increase, and a “no” vote would reject it.
If the tax measure passes, a three-year income tax surcharge would begin and taxpayers would pay an additional 1 percent to 9 percent of their income tax, depending on their yearly income. A family earning the median Oregon income of $41,000 would pay an additional $36 or more in income tax, according to the Legislative Revenue Office. An individual earning less than $10,000 would not have to pay any additional income tax.
Angela Wilhelms of the Taxpayer Defense Fund, the group spearheading the effort to reject the tax surcharge, said the campaign is seeking to educate Oregonians on the downside of the increases.
Along with the three-year surcharge on personal income taxes, Oregon senior citizens will face a reduction, or elimination, of the ability to deduct medical expenses from state taxes, Wilhelms said. Property owners would see the early payment discount on property taxes cut in half from 3 percent to 1.5 percent, she added.
HB 2152 would also impose a minimum business tax of anywhere from $250 to $5,000 on corporations in the state and disallow small businesses from deducting the cost of utility vehicles for business purposes. State cigarette tax increases would also be extended from January 1, 2004 to 2006.
Wilhelms called the combination of taxes “relatively convoluted.”
“Our goal is to educate voters on this package and how it affects everyone,” she said.
Wilhelms said the amount of opposition towards the surcharge has been surprising, adding that most of the returned petitions were distributed by volunteers outside of the organization.
“We are still getting calls from people who ask if they can still get their signatures in or asking if there is another way they can help,” she said.
Morgan Allen of Our Oregon Coalition, an organization supportive of the tax surcharge, acknowledged the number of signatures shows that a substantial number of Oregonians are against the tax increase.
“It shows we have a real fight on our hands,” Allen said.
However, Allen said his organization has a “good shot” in getting the tax surcharge passed through the voters.
Allen said his organization’s goal leading up to the election is to educate Oregonians about the benefits of the surcharge and how it would help many public services. He said the surcharge would bring “stability” to state-funded institutions, such as education and health care.
Allen said if the tax surcharge is rejected, Oregonians could face a shortened school year for K-12 students, loss of prescription medication benefits for senior citizens and having courts in operation for four days a week instead of five. He said the loss of the surcharge would also affect college students.
“Basically, if this measure goes down, students are looking at another tuition increase,” Allen said.
Allen said the organization will have volunteers go out into communities to let people know how services will be affected.
“It pretty much has to be a grassroots effort with Oregonians talking to Oregonians, and neighbors talking to neighbors,” Allen said. “People need to understand it will have an impact on services.”