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Tim Carney: Oregon legislature holds Nike Session to pass special tax provision

December 18, 2012 | 2:57 pm | Modified: December 18, 2012 at 3:20 pm
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Oregon’s Democratic Governor called a special session of Oregon’s Democratic legislature, and they passed a special tax bill for megacorp Nike.

The content of the bill passed by the Nike Session strikes me as unobjectionable, until you get to the last part of this description from the Oregonian:

At issue was the state’s method of taxing multistate corporations. Oregon uses a “single-sales factor,” which taxes profits on sales only within the state, not on worldwide sales, property or payroll.

Nike wanted a guarantee that the method won’t change, and Kitzhaber said he feared Nike would go elsewhere if the state didn’t act.

House Bill 4200 gives Kitzhaber authority to sign a similar contract with any company that promises to invest $150 million and create 500 new jobs. Nike’s expansion will be at least that big, company officials said.

I think its fine for politicians to make binding promises not upend the corporate tax system in order to hike taxes. But Kitzhaber’s is a special deal for one company. And the only other companies that can get it are huge corporations.

So, if 100 different entrepreneurs were to invest $1.5 million each and create 5 new jobs each, they might see their taxes go up. But a corporate behemoth can get special treatment.

I don’t resent Nike trying to get such assurances from Kitzhaber. I resent Kitzhaber and the bipartisan majorities of the state legislature for giving these assurances only to favored (read, “big”) companies.

Nike is experienced at using its politics for profit — I remember when the company lobbied for climate-change regulations that would tax its opponents while leaving its own manufacturing untouched.

And there’s something about the Pacific Northwest where they call special sessions of the legislature just to give special favors to individual companies. Washington State Gov. Gary Locke held a Boeing Session last decade.

From WeeklyStandard.com

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