Wednesday, November 25, 2009

Say What? More Tax Silliness

Can we have a honest debate about the tax increases? In last Sunday's Oregonian, Harry Esteve quotes the general manager of Gresham Ford claiming that the company's tax bill will go from $10 to $30,000 if the tax increases are approved. Huh? This makes no sense at all. If this is true it can't have anything really to do with the new taxes for if the company was paying the corporate minimum it should only go up to $150 - the new corporate minimum under the proposed new taxes. She also claims that this will require that the company lay off an employee. Huh again? If this is 'one of the busiest car dealers in the state' how does a $30,000 hit to the profits necessitate a lay off? Companies usually make staffing decisions based on what is optimal for operations, in this case given the volume of cars they sell. As the tax should have not affect demand or supply, this volume should not change. Thus the profit maximizing level of staff should be the same.

In other words this is just ridiculous on both counts and is nothing but a scare tactic. Now I know that this is a quote, but the tax burden stuff makes no sense and I would expect a reporter to think about the motivation and veracity even of a named source. Is good reporting really just getting a couple of quotes?

By all means let's debate the taxes, but let's do it honestly.


Mr imam spd said...

hello oregon... is nice place in the US?

Jeff said...

Very nice post. I was talking to a car dealer last August and they were thinking that this proposed tax will 'drive is out of business'. I understand that many car dealers are struggling right now. A new tax is the last thing they could want. Yet the net result should be very, very minor, if felt at all. I tried to make this argument -- not sure if I succeeded.