The primary goal of tax cuts will be to eliminate as many small taxes and fees as possible and streamline the process, only collecting taxes from a few sources in large amounts. The more sources of taxes there are, the more paperwork that has to be done by the government and by the tax payer. I will also work to decrease property taxes as well. The amount of overall decrease in taxes will increase overtime, as more budget cuts are made and essential infrastructure i.e homeless shelters, government owned apartments, and video cameras finish being installed. Below are several possible cuts I plan on making overtime, although more will be found. The city does not currently document all of it's sources of revenue in one place online. I will work on creating better revenue summaries for the city, documenting all taxes and fees in one place. This will help to make cuts.
Eliminate Paid Parking - Paid Parking only brought in $50 million in 2018, at the same time parking enforcement cost around $8 million in 2023, meaning around 15% of revenue was spent on enforcement.1 There are probably several other expenses related too operating Portland's paid parking system on top of this. Paid parking is also bad for business as it deters customers from coming downtown. In the short term I plan on eliminating paid parking on the weekends. Time limits on paid parking can also be eliminated in the short term to make parking easier.
Eliminate Heavy Vehicle Use Tax - The Heavy Vehicle Use Tax only brings in $2 million a year. It is also is an inequitable tax, as it is placed on working people who need heavy vehicles to perform jobs that are crucial to our economy.2
Eliminate Arts Tax - The arts tax currently brings in around $13 million a year.3 This is an insignificant amount of revenue. It is also is an inequitable tax as everyone pays the same amount no matter their income, except a few low income residents who are exempt.
Eliminate Gas Tax - The Gas tax currently brings in $15 million.4 This is an insignificant amount of revenue. It is also is an inequitable tax as low income residents pay a larger percent of their income on gas. It also increases the expenses of companies that rely on oil.
Eliminate Lodging Tax - Lodging tax currently brings in an estimated $50 million in the Portland Area.5 This tax deters tourism, and affects people who may be going through a tough time and need housing.
Eliminate Clean Air Fund - The clean air fund currently brings in around $100 million.6 The issue with this fund is that the 1% tax is inequitable as it is a tax on revenue instead of profit. Profit margins greatly differ depending on the company so when you tax revenue your essentially taxing companies at different rates. For example a company with a 3% profit margin getting taxed 1% of their revenue is paying 33% of their profits. A company with a 30% profit margin getting taxed 1% of their revenue is paying 3.33% of their profits. The money is also being spent in an inefficient way as Portland does not have the greatest clean energy potential. This tax will be replaced by my state initiative for 100% renewable energy in Oregon.
Change Universal Pre-School Tax - The Universal Pre-School tax is currently funded by a personal income tax of 1.5% on taxable income over $125,000 for individuals and $200,000 for joint filers, and an additional 1.5% on taxable income over $250,000 for individuals and $400,000 for joint filers. The rate will increase 0.8% in 2026.7 The plan is to eliminate this tax and replace it with a territorial corporate tax on profits earned from sales within Multnomah County. This will be a superior tax as it is un-evadable, and will take less paper work for companies to file. Based on average national profit margins8 of 10-15% of the National GDP over the past 10 years and the Multnomah County GDP of $83 billion in 2022,9 profits in Multnomah County are around $8.35 - 12.53 billion. Based on this a 1.5-2% tax could be could be used to collect the revenue for Universal Preschool.
Change Supportive Housing Services Tax - The current tax is a personal income tax of 1% on taxable income above $125,000 for individuals or $200,000 for couples filing jointly, and a 1% corporate income tax on profits for businesses with gross receipts above $5 million.10 The tax is currently bringing in around $365 million a year. Based on average national profit margins and a GDP of the metro area of around $180 billion in 2022,11 profits are between $18-27 billion. Based on this a tax of 1.5-2% on profits would be needed.
References
1a Retrieved from https://www.portland.gov/cbo/2023-2024-budget/documents/fy-2023-24-adopted-budget-volume-1-citywide-summaries-and-bureau/download (Page 473)
2 Retrieved from https://www.portland.gov/transportation/fixing-our-streets/hvut
3 Retrieved from https://www.portland.gov/cbo/2023-2024-budget/documents/fy-2023-24-adopted-budget-volume-2-funds-and-capital-projects/download
4 Retrieved from https://www.portland.gov/transportation/fixing-our-streets/proposed-measure-26-245
5 Retrieved from https://industry.traveloregon.com/wp-content/uploads/2020/03/Local-Transient-Lodging-Tax-Report_-Feb-2020-FINAL.pdf (Page 28)
7 Preschool for All Tax Coffers Overflow as Wealthy Payers Reap Capital Gains. Retrieved from https://www.wweek.com/news/2023/02/09/preschool-for-all-tax-coffer-overflows-as-wealthy-payers-reap-capital-gains/
8a Profits Before Tax. Retrieved from https://fred.stlouisfed.org/series/A053RC1Q027SBEA
8b GDP. Retrieved from https://fred.stlouisfed.org/series/GDP
9 Multnomah County GDP. Retrieved from https://fred.stlouisfed.org/series/GDPALL41051
10 Supportive Housing Services Tax. Retrieved from https://www.oregonmetro.gov/sites/default/files/2023/08/28/FY2022-23-supportive-housing-services-tax-fiscal-year-end-memo-20230828.pdf
11 Total Gross Domestic Product for Portland-Vancouver-Hillsboro. Retrieved from https://fred.stlouisfed.org/series/NGMP38900