Steve Buckstein presented the following testimony to the Joint Interim Committee on Special Session prior to the September 30th special session. The audio of the hearing is here. Steve’s testimony begins at 1:09:22. He was the first member of the public to testify on Legislative Concept 3, the revenue raising part of the so-called Special Session Grand Bargain. Each person was limited to two minutes of oral testimony:
Testimony Before the Joint Interim Committee
on Special Session in Favor of
Small Business Tax Cuts
by Steve Buckstein
Good morning, Co-chairs Courtney and Kotek and members of the Committee. My name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, which is a non-profit, non-partisan think tank based in Portland. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.
While I do not support the revenue raising portions of this legislation, reducing tax rates on small businesses is a very positive step that I urge you to take.
There was an instructive exchange on this topic on June 20th before the Senate Finance and Revenue Committee.* One tax cut opponent noted that he didn’t believe the person who fixes his washing machine was going to buy another truck and get another employee for his small business because of a reduction in his tax rate.
I then told the committee that while this one repair man may not change his economic behavior, a tax cut just might be the deciding factor for some entrepreneur to locate a new washing machine manufacturing plant here, hiring dozens or hundreds of Oregonians.
We need to understand that in this modern world, people and capital are mobile. Investors and businesspeople change their behavior based on the incentives and disincentives they face. Oregon’s high tax rates shine like a big STOP sign at every border, warning high-income people and many businesses that the cost of staying here or coming here may be too high compared to other states.
So, rather than rely on taxing others more to generate revenue, rely on the fact that lowering small business tax rates will make Oregon more business friendly, thus generating jobs and more tax revenue.
I have it on good authority that each of you would like to take credit for creating more jobs in this state. Here’s your chance.
* June 20th Hearing audio. The tax cut opponent’s repair man story begins at 1:25:40. My full testimony begins at 1:45:37 and my repair man story rebuttal starts at 1:47:40.