Revenue reform in order to ensure adequate and stable state services for children, the elderly, and those in need remains a top priority for me. While some steps were taken in 2009 toward this goal, much more can and should be done.

Principles that I follow in assessing any proposed tax reform include:

a. It must not shift the tax burden away from the wealthy and toward the poor.

b. It must not result in cuts to state responsibilities such as education, health care, and public safety.

c. It must make Oregon's revenue system more stable and sustainable over time.

• Larger education and enforcement budgets for the Department of Revenue. Increased auditing and stronger penalties will pay for themselves many times over by bringing more taxpayers in compliance with the law.
• Capping tax giveaways. Out of every $1 of potential income tax revenue, the state gives away $0.45 in credits, deductions, and exemptions - sometimes without any corresponding public benefit. A 10% reduction in these tax breaks would generate as much as $1 billion in new revenue for schools and other vital services. Tax giveaways ought to be given the same level of scrutiny as other government expenditures.
• An end to the kicker. While the personal kicker is considered untouchable and the super-majority requirement likely makes the corporate kicker nearly as difficult to eliminate, I would support the constitutional referral that would be needed to eliminate this bad public policy.

Raising the Corporate Minimum - 2009
HB 3405 raises the minimum tax paid by corporations from $10 to $150. About two-thirds of Oregon businesses currently pay the corporate minimum. Under HB 3405 the corporate tax rate increases to 7.9% on net income over $250,000. The rate drops to 7.6% in 2011 and settles permanently on businesses earning over $10 million per year at the 7.6% rate.

Raising the Tax Rate for the Wealthiest Oregonians - 2009 HB 2649 increases the tax rate for households earning from $250,000 to $500,000 from 9% to 10.8%. The bill increases another 0.2% on income over $500,000. In 2012, the rate would permanently set at 9.9% on income over $250,000. Families earning less than $250,000 of adjusted gross income will pay no additional taxes.

Rebuilding the Rainy Day Fund - 2009
HB 2073 diverts some corporate tax revenue directly into Oregon's Rainy Day Fund starting in 2013.

Taking a Closer Look at Tax Credits - 2009
HB 2067 allows for an orderly review of certain tax credits not required under federal law or the Oregon Constitution by creating staggered sunset provisions on such tax credits.

Rainy Day Savings Account - 2007
HB 2707 establishes the state's first ever savings account - a Rainy Day fund that will protect Oregon from drastic cuts in education, public safety, and social services in the event of a recession. This Rainy Day fund is established with a one-time diversion of the corporate kicker.