Tobacco Facts.

Political leaders in Oregon don’t want to raise taxes on beer and tobacco because they don’t want to increase the tax burden on “working class people” in these tough economic times. Because we all know it’s just the rubes who like beer and tobacco.

Anyway, that’s a good thing. But what’s motivating them isn’t. They don’t want these excise taxes to get in the way of big income and corporate tax hikes they’ve got planned.

SALEM, Ore. Proposed beer and cigarette tax increases have been shelved by Democratic legislative leaders who say they do not want to increase the tax burden on working class people in these tough economic times.

But thereТs another issue at play here lawmakers also do not want beer and cigarette tax hikes to drag down the big income tax increase package they have already passed to balance the next two-year budget.

The $733 million tax increase on corporations and upper-income households is central to the Democrats strategy to keep state services afloat by making some cuts, using reserves and stimulus dollars and trying to avoid raising taxes on lower- and middle-income Oregonians.

This point, so-called СsinТ taxes do not meet the test, Oregon House Speaker Dave Hunt said on Friday.

What these guys don’t understand is that tax increases on corporations, and even tax increases on “the rich,” are still paid for by everyone.

Corporations are businesses. Taxes, for businesses, are overhead. Meaning these businesses will simply pass the expense of these new taxes on to their customers and employees by either raising prices or cutting costs (lay offs, benefits cuts, etc.). Even taxing the rich can hurt. Maybe the rich being taxed can afford it, but can the guy who was going to sell the rich family a new boat afford to lose that sale? Can the guy who mows their lawn afford to lose that account?

When the government takes more money out of the economy it doesn’t help anyone, rich or poor. It hurts everyone, because more taxes means less economic activity.

If the folks in Oregon really wanted to help middle class Oregonians they would cut taxes to spur economic activity and thus more jobs and prosperity.

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