Lithia Motors officials on Measure 97: “Vote no”

Medford, Ore. — A prominent Rogue Valley businessman is coming out against a measure on the ballot this November. Measure 97 is a proposed corporate tax aimed at generating revenue for education, health care, and senior services. Those in favor of the measure say it’s a small number of affected businesses that will make a big difference in funding critical services, but the founder and chairman of the board for Lithia Motors says there are better ways to generate those funds.

“I agree totally that those things need solutions,” Sid DeBoer, board chairman of Lithia Motors says, “but there are better ways, not this way, this is so discriminatory against company’s like ours.”

Sid DeBoer says Measure 97 is not the way to generate additional revenue for the state of Oregon.

“People do not understand that this is the largest tax increase,” DeBoer says, “and they’re gonna mostly pay for it.”

As proposed, the measure would impact certain corporations by establishing a $30,000 minimum tax, plus 2.5% on corporate gross sales over 25 million dollars. DeBoer says for many big businesses, that cost will be passed on to Oregonians through higher prices, something he says they can’t do.

“Lithia Motors is uniquely public and can not become a regular corporation that won’t have to pay this,” DeBoer adds, “only large C corporations will have to pay this tax.”

DeBoer says many of Lithia’s competitors may avoid the tax by becoming an S corporation meaning the owner or the shareholders include the corporations profits on their personal tax returns, rather than the corporation itself being taxed as a separate entity. DeBoer says that puts them in a tough spot.

“It would be almost a thousand dollars a car, and our competitors aren’t going to pay it,” DeBoer says, “we can’t charge our customers a thousand dollars more than the competitors.”

DeBoer says a half a percent gross receipts tax on all companies in Oregon would be a better solution.

“It would be a consistent revenue that wouldn’t go up and down with earnings, that would provide help for the schools, and PERS and Medicaid and all the problems Oregon faces.”

Whether a corporation is a C or S corporation is not public record so it’s unclear how many businesses would be impacted by the tax. But according to “Vote Yes on 97”, less than a quarter of a percent of Oregon businesses will see their taxes go up.

 

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