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Click Here 47 °F Forecast | Road Cams Wednesday, January 28, 2004 Today's News | Classifieds | Autos | Homes | Jobs | Tempo | Health | Community | Home Delivery SECTIONS Home Page Local News Sports Business Obituaries Life Opinion - Politics AP News Weather Classified Archives Site Map EXTRA Newspaper in Education Personals Movie Times TV Times E The People CLASSIFIEDS Find a Car Find a Home Find a Job Find a Rental Place an ad eSouthernOregon Automotive Communities Entertainment Publications Recreation Calendar CUSTOMER SERVICE Frequent Questions Advertising Information Home Delivery Employment Contact Us Media Kit Network Affiliate Email Story to a Friend January 4, 2004 Mail Tribune photo illustration / Bob Pennell Voices of the Vote: Southern Oregon Talks Taxes Not sure what’s included in the surcharge ballot? You’re not alone By JONEL ALECCIA Mail Tribune Between now and Feb. 3, George Jorgensen figures he and other Southern Oregon voters need a crash course on Ballot Measure 30. Jorgensen, a 69-year-old Rogue River retiree, has heard about the temporary income tax surcharge approved by the 2003 Oregon Legislature. But before he votes on whether to uphold or overturn the $800 million plan to balance the state’s $11.5 billion, two-year budget, Jorgensen wants details about everything else the referendum contains. "There are some things in there you don’t even know about, that you haven’t even heard about," says Jorgensen, who meets regularly with a dozen folks who feel the same. Reductions in medical deductions for seniors, changes in corporate taxes, an extended cigarette tax, even an end to depreciation allowances for SUVs are among the explanations sought by Jorgensen and his pals. Advertisement And they’re not alone. Nisse Lowery, a 29-year-old college student and mother of three from Medford, admits that she’s vague on many of the details of the pivotal tax vote. "I know nothing about it," she says. "Part of it’s my fault because I haven’t gotten informed. I’ll have to look it over and discuss it with my dad and go from there." Even Jean Milgram, 81, an active member of the local League of Women Voters, was unclear about planned changes in corporate taxes and surprised by a provision that reduces medical deductions for higher-income seniors. "I didn’t know they did that!" says Milgram, a resident of Medford’s Rogue Valley Manor who supports the measure. "It’s terrible what people don’t know." Understanding all of the issues is key to an educated decision, says Jorgensen, who’s leaning toward a "no" vote. "The reason I’m totally against it is because I’m not totally informed," he says. Ballots will be mailed starting Jan. 16 for the Feb. 3 special election. At issue is whether to uphold the legislative revenue package hammered out during the longest session in state history last summer. House Bill 2152 created about $800 million in new and extended taxes. Measure 30’s key element is the temporary, graduated income tax surcharge designed to raise $544.6 million to avoid drastic cuts to schools, health care, senior services and public safety. But the measure also considers whether to uphold another approximately $235 million in actions aimed at closing the state’s budget gap. The specific components of the referral follow. Information has been summarized from the Legislative Revenue Office, a non- partisan research department, and other sources. PERSONAL INCOME TAX Surcharge: The primary element of the revenue package is a temporary, graduated income tax assessment. It varies from 1 to 9 percent of taxes paid according to the adjusted gross income of the taxpayer. It applies to the 2003, 2004 and 2005 tax years, although the 2005 assessment is automatically eliminated if state general fund revenue increases enough. The surcharge is expected to raise $544.6 million in general fund revenue for the 2003-2005 biennium. A single taxpayer earning a median Jackson County wage of between $30,000 and $40,000 annually would pay $43 a year. Joint filers earning between $50,000 and $70,000 annually would pay $102 a year. Senior medical deductions: Measure 30 modifies Oregon’s additional medical deduction law for seniors by raising the age for eligibility from 62 to 65 over three years and by linking eligibility to income. The deduction is phased out for joint filers with adjusted gross income of between $30,000 and $100,000. The deduction is eliminated for single filers earning more than $50,000 a year or joint filers earning more than $100,000. Single filers earning less than $15,000 or joint filers earning less than $30,000 may still claim the deduction. To claim the benefit, seniors must itemize deductions on their tax forms and have medical expenses. In 2001, 47 percent of Oregon seniors over age 62 used the additional deduction. The change is aimed at raising $42 million in new revenue. For seniors with income of between $40,000 and $50,000 annually, the average net tax increase would be $103 a year. SUV depreciation: Measure 30 eliminates allowances for depreciation of certain large SUVs, trucks and vans for business purposes. The new provision requires businesses to add back expense and depreciation deductions allowed on federal taxes for these vehicles. Vehicles used primarily for farming, forestry and construction are exempt from the add-back. The change would raise about $4.7 million in revenue. PROPERTY TAX Under previous law, Oregon allowed a 3 percent reduction in property tax bills if taxpayers paid in full before Nov. 15. Beginning with the 2004-2005 tax year, Measure 30 reduces the discount to 1.5 percent. Of the $43 million expected to be raised by the change, two-thirds will go to the state general fund and one-third will go to the state school fund. After 2004-2005, the rate will remain 1.5 percent, and the additional revenues will go to local taxing districts, including schools and community colleges. CIGARETTE TAX A 10-cent per pack tax on cigarettes is scheduled to end this year. Approval of Measure 30 would extend the cigarette tax through 2005, raising an estimated $23.4 million over the biennium. The funds would be designated primarily for the Oregon Health Plan. CORPORATE INCOME TAX Measure 30 makes a number of changes to Oregon’s corporate income and excise tax law. The first is to raise the flat corporate tax of $10 a year. The new minimum varies from $250 to $5,000 for C-corporations and from $250 to $500 for S-corporations. It is expected to raise $73.4 million. (An S-corporation is a business in which income is taxed to the shareholders; a C-corporation is a firm in which income is taxed at the corporate level, according to Paul Guthrie, a program technician for the Oregon Department of Revenue.) Measure 30 eliminates a corporate deduction for income earned outside the country, a move expected to raise $18 million. The measure reduces by half the amount of dividend income from subsidiaries that can be deducted for three years. That would raise $38.4 million. It also reduces all corporate tax credits, except those for low-income and farm-worker housing, by 20 percent for three years. That would raise $16.4 million. MEDICAL CARE TAX Measure 30 establishes a provider tax on nursing homes and imposes assessments on prepaid managed health care groups based on premiums. That move will raise $12.5 million for the state general fund. For more information about the components and costs of Measure 30, visit the Legislative Revenue Web site at www.leg.state.or.us/comm/lro/home.htm . From there, click on "publications" and scroll to the report on Ballot Measure 30. For views from backers and critics of the measure, check these two Web sites: www.ouroregoncoalition.com www.stoporegontax.com Reach reporter JoNel Aleccia at 776-4465, or e-mail [email protected] Mail Tribune Home Local News | Sports | Business | Obituaries | Life Opinion - Politics | AP News | Archives | Site Map E Southern Oregon | Classified Copyright © 1997-2004 Mail Tribune. All rights reserved. Privacy Policy | Terms & Conditions Website Feedback 3 WEEKS FREE! ADVERTISERS A D V E R T I S E R S RESOURCES Oregon Road Conditions & Cams SPECIAL SECTIONS Auto Finder Job Finder Home Finder Joy Magazine Homelife Magazine Tempo Readers' Choice Real Estate Showcase Since We Asked Food for Thought Wellness Connection Outdoor Journal Moving to Southern Oregon? Volunteer Opportunities Prime Times