This West Coast blue state could tax big companies and guarantee basic income for residents

You don’t have to watch reruns of “Portlandia” to know that Oregon is steadfastly unique. That goes for its government, too. In 2021, it re-established Mill Ends Park, the world’s smallest public park consisting of just one tree, and only legalized self-service gas in August 2023, a change that made headlines in Convenience Store News.

And with Election Day 2024, the Beaver State is asking voters whether they’d like to pocket an annual rebate — $1,600 for every person in their household — by socking it to companies with in-state sales greater than $25 million. And if that sounds like something only pro-business Republicans could hate, guess again: Top Oregon Democrats can’t stand the idea either.

Supporters of Ballot Measure 118, also known as the Oregon Rebate, contend it will cut child poverty in half and boost the state economy by giving residents more money to spend. It’s an example of universal basic income at work, and if passed, would represent one of the most ambitious programs of its kind in the U.S.

Oregon would pay for the rebates by increasing the minimum tax on corporations with in-state sales of more than $25 million by 3%. The only state-level program that remotely resembles the Oregon Rebate is Alaska’s Permanent Dividend Fund, which paid state residents $1,702 in 2024, up from $1,312 in 2023.

California, in theory, could follow Oregon’s example. There, 125 low-income residents of Stockton received $500 a month in a pilot program for 24 months, no strings attached.

But whether this measure is a good idea is up for debate.

In typical Oregon fashion, Measure 118 traces its roots to a coffee shop huddle and is the brainchild not of a political think tank but a former neuroscientist-turned-organizer. Antonio Gisbert started the petition that created the ballot question and it took him about six years to reach this moment of truth.

“Only when we are all successful will we have justice with like a Capital J,” he told Willamette Week back in July.

But the Oregon Rebate has also sparked outrage with a capital O. Democratic Governor Tina Kotek may have brought self-service gas to the masses but she’s not about to fuel this effort, claiming it “would punch a huge hole in the state budget and put essential services for low-wage and working families at risk.”

Legislative leaders in both parties, most of Oregon’s major labor unions and nearly all its major business organizations also oppose it.

Gisbert, however, remains unfazed.

“It kind of does seem a little bit like some of these elected [officials] are more beholden to corporations and corporate interests than they are to the interests of everyday Oregonians,” he told Business Insider.

But Gisbert and his fellow grassroots supporters have their work more than cut out for them. By one estimate, their opponents are ahead with a fundraising ratio of 30-to-1.

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Though the notion of redistributing corporate gain to heal economic pain has obvious appeal, Measure 118 has pronounced flaws. While supporters cast rich corporations as the enemy, the fact is that wealthier folks would get the rebate as well. So any argument that the law would act as a weapon against poverty doesn’t quite hold water.

Also, a 3% tax hike has a much more dramatic bottom-line impact on businesses when you examine it closely. Buried in the 24-page document that describes Measure 118, you’ll find numbers to make many merchants lose their lunch, caviar or otherwise.

Currently, operators with state sales of $70 million pay minimum taxes of either $150 (for an S-corp) or $50,000 (C-corp). But if voters approve the measure, those minimums would super skyrocket to $1.4 million.

As any first-year MBA student knows, tax-walloped companies tend to take their business elsewhere. Oregon already ranks 28th among all states for its business tax climate, according to the Tax Foundation.

So if it passes, Measure 118 would come just in time to help a flummoxed CEO buy a first-class plane ticket to neighboring Nevada, which places seventh among the top ten states for business tax climates.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.