Steve BucksteinQuickPoint!

Oregon food processors are the latest business interests flocking to Salem seeking tax relief to keep their industry afloat. They support two legislative bills that would give them tax credits to reduce the burden of their property taxes and seasonal labor costs. The processors argue Oregon’s high taxes and second highest minimum wage rate in the county leave them particularly vulnerable to foreign competition.

In this battle, both sides have valid points. Not just food processors, but many industries feel the pressure of high taxes and wage rates for unskilled labor. It’s perfectly understandable why they seek relief from such government imposed costs.

The other side is just as right to claim that singling out food processors for relief grants processors special treatment vis a vis every other business saddled with similar costs. Opponents will also likely argue that such relief amounts to little more than corporate welfare.

So, what should legislators do when faced with good arguments on both sides? They should understand that granting relief to specific industries amounts to picking winners and losers in the economy, a job they have no business doing. It’s not the way to make Oregon business-friendly.

Rather than grant selective relief, legislators should begin across-the-board removal of burdens they’ve already placed on business. Lower income and capital gains tax rates, reduce or repeal the minimum wage, and eliminate harmful regulations. Food processors would be less likely to ask for special treatment if Oregon treated all businesses as special.

Steve Buckstein is senior policy analyst at Cascade Policy Institute, a Portland, Oregon based think tank.

© 2006, Cascade Policy Institute. All rights reserved. Permission to reprint in whole or in part is hereby granted, provided the author and Cascade Policy Institute are cited. Contact Cascade at (503) 242-0900 to arrange print or broadcast interviews on this topic. For more topics visit the QuickPoint! archive.

 

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