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The Senate Revenue Committee has agreed to boost taxes on wealthy Oregonians to help offset a $25 million package of tax breaks that will benefit a number of groups, such filmmakers, trucking companies, developers of biodiesel plants and parents trying to save money to send their children to college.
The tax increase would apply to single people earning more than $156,400 a year and couples earning more than $234,600. Oregon taxpayers reduce their state income tax bill by claiming a credit of $159 for each person claimed on a tax return. If the committee's proposal comes to fruition, high-income people would see their tax credit decrease to between $52 and $156 per person - depending on where they fit on a sliding scale.
Ryan Deckert, the Beaverton Democrat who chairs the Senate's tax-writing committee, said it's good policy to raise taxes on the wealthy to pay for tax breaks that are mostly geared toward businesses.
The most expensive of the tax breaks would reimburse businesses for half the cost of wind farms, biofuel plants and other renewable energy plants or equipment. Deckert said that break will create good jobs and make Oregon more prosperous.
Other proposed tax breaks would:
_ Allow parents saving for college to deduct their contributions, up to $4,000 a year.
_ Reward truckers or trucking companies that retrofit their diesel engines to release less pollution.
_ Expand the tax credit for businesses to take energy-saving steps.
_ Offer filmmakers bigger cash rebates to lure them from other states.
_ Let the children and grandchildren of people who own forestland, farms, farmhouses, fishing boats, fish processing plants and nurseries worth up to $7.5 million inherit the property tax-free.
The tax credit bill needs approval from the full Senate and the House. Most of the tax breaks would expire, typically in 2012, if future Legislatures don't renew them; however, the change in the estate tax law would be permanent.
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