Economists say our economy is recovering – but for who?
Many parts of the state are seeing high unemployment rates, and in the areas where jobs are available, they don’t pay enough to support a family. Many Oregonians want to work, but their jobs aren’t working for them: Wages have been cut, hours and benefits have been slashed, and families are left on the brink of collapse, forced to rely on publicly funded programs to make ends meet. One in four workers in Oregon earns less than $12 an hour, and one in four Oregonians receives food stamps. On the other hand, large corporations are seeing higher profits than ever before.
Corporate profits are breaking records because they’re cutting wages and benefits. By paying their workers so little that they must depend on state services to make ends meet, large and out-of-state corporations are reaping the rewards of their workforce — as well as taking advantage of the taxpayers who subsidize those crucial state services.
What’s more? Corporations in Oregon pay the lowest business tax rates in the country. They use every loophole in the book to avoid paying their fair share. Partly because many corporations stash trillions in offshore tax havens, most corporations in Oregon pay our minimum tax – which for many corporations is still just $150. And some of the biggest corporations are using loopholes and accounting tricks with tax credits to bring their tax bill to literally zero – 393 corporations paid no taxes in Oregon in 2013.
This is a raw deal for the rest of us. The cost of providing public assistance to working Oregonians is high — taxpayers subsidize corporations’ reliance on a low-wage workforce to the tune of $1.7 billion a year. Without state subsidies, workers can’t put food on the table. And yet large corporations are making more than ever before because they’ve decided to let us pay for the work they get. Companies that employ large, low-wage workforces benefit disproportionately from the existence of these programs. Simply put, corporations taking advantage of this system are reaping substantial benefits from state-funded social benefit programs.
That’s where the Employment-Related Public Benefit Fee comes in. HB 3471 requires companies with more than 250 employees to pay an hourly-based fee ($.50) for every worker earning under $11 an hour or 120% of the state minimum wage rate. The fee will offset a portion of the actual costs incurred by the state to administer, strengthen and expand state programs that enable Oregonians to enter and remain in the workforce. The funding generated by the fee will be used to support and improve access to quality, affordable health care and child care for working families, allowing low-wage workers a better chance of remaining in the workforce.
Based on Oregon labor market data, 540 Oregon companies would be covered by the Public Benefit Fee and would pay the fee on nearly 100,000 workers. The fee could raise about $100 million per year for critical public services – a fraction of what’s needed to cover the cost, but at least a start in the right direction.
It’s already the case that our state has a regressive corporate tax structure, with larger, more sophisticated corporations contributing less to Oregon while taking advantage of our workers and our state services. It’s time that we take steps to start holding large corporations accountable, and we should start with the Public Benefit Fee.