Here's another reason to change PPS leadership

Nike's donation of $9 million over five years to three local school districts, including Portland, has district officials doing cartwheels.

But as Steve Duin points out, corporate donations come at a cost --namely, tax revenue.   Like  $16.7 million in tax revenue that Nike won't be paying to the state for 2006 because of changes in the corporate tax code that the Beaverton-based company actively lobbied for:

"Nike lobbied viciously, and successfully, for the single-sales factor, which dramatically cut income taxes for companies with significant property and payroll in Oregon but a majority of sales outside the state."

No surprise then that Nike donated nine mill over five years when if saved nearly twice that in a single tax year.

Have the district and its board "viciously" lobbied for corporate tax reform at the state legislature?  If they have, they've been doing it largely out of the public eye,  probably for fear of offending their allies and sugar daddies in the business world. 

The increasing reliance on grants and handouts from the private sector to fund schools is worrisome to me.  It raises the question:  Who ultimately determines policy for  Portland Public Schools?  Phil Knight?  Bill Gates?  Or the public in an open and democratic fashion?

The district's excitement over Nike's million dollar donation goes a long way in answering that question.

Comments

[howard]

"companies with significant property and payroll in Oregon"

I suggest it would be more fair for corporate detractors to acknowledge payroll and property taxes that corporations pay as well as the property and income taxes corporate employees pay. Also the capital gains and income taxes on dividends that Oregonians owning Nike stock pay.

I would like to see a statewide conversation on the pros and cons of the corporate income tax which is difficult to enforce and amounts to double taxation on dividends which are paid on profits remaining after federal, state and local taxes are paid. There is also the near impossibility of forecasting corporate profits from year to year which results in frequent kicker refunds to corporations when they do show profits.

[Terry]

One can affix the epithtet "double taxation" to virtually any tax that is commonly assessed, for example the sales tax which in many (most? all?) states is not deductable, and never deductable if you don't file an itemized return.

And then there's the estate, or "death", tax.

The bottom line is that the share of income taxes paid by corporations has dropped precipitously in recent years relative to personal income taxes.

[Terry]

Oops! It should be "epithet" and "deductible".

[howard]

I overcame the temptation to respond with an epithet. The "double taxation" of corporate income and later dividends takes place when a single collector(State of OR) taxes income from the corporation in a given year; then again from the stockholder who receives divinds from that same income source. If you tack on the federal "double taxation" do you call it quadruple taxation?

Thanks Terry, for the thoughtful and in-depth discussion of the pros and cons.