Tina Kotek on Corporations

Adjust Corporate Activity Tax for different sized businesses

Kotek: We have to have a tax system that is adequate and fair and allows us to be competitive, and what I heard from the council is we should make some adjustments. And so the types of things that were listed in their top 10 recommendations like expanding the research and development credit, for example, making sure that if you want to invest in an Oregon company, you will be more protected if you're taking some risk. We need to look at the CA tax [Corporate Activity] and how it has to be adjusted for different sized businesses. It's funding education. It's an important revenue stream, but it could be improved. What I've said to legislative leaders is let's get started on that, but let's not blow a giant hole in our budget.

Drazan: Oregon's business taxes are too high. We're no longer competitive when it comes to the tax burden, but I would say this: we have to fix the commercial activities tax. The corporate activities tax is a mess.

Increase threshold of Corporate Activity Tax from $1M to $2M

The governor said she was in the midst of working on a "very nerdy" project to better track where the money is going. "So when we're done with this project, all 197 school districts are going to be able to tell us how they are spending their money because under my accountability bill that passed last year, if you are not meeting your performance standards two or three years from now as a district, 25% of your state school fund dollars will be potentially managed by the state," Kotek said. More directly, Kotek said she was open to making changes to the tax for smaller businesses.