Business group launches effort to refer Salem payroll tax to voters
The Oregon Business & Industry, a statewide chamber of commerce and trade association, has launched an effort to refer Salem's recently adopted payroll tax to voters.
Oregon Business & Industry has until Aug. 9 to get 4,000 signatures in order to refer the issue to the November ballot. To account for possible errors, they are aiming to get 6,000 signatures.
Officials with the Salem-based group said the new tax will be a significant burden for employees, exacerbatingthe effects of steadily rising inflation and providing an incentive to seek work outside of Salem or stop coming to the city for portions of their work.
For employers, the tax will create a significant compliance burden, especially for those with employees who travel or work hybrid schedules, group officials added.
The Salem City Council voted July 10 in a 5-4 split to adopt a .814% Safe Salem employee-paid payroll tax for all work performed within city limits.
About four dozen people testified, mostly in opposition, during the council meeting.
After hours of testimony and deliberation, council voted to skip sending the issue to voters and instead opt to implement it themselves. Councilors Julie Hoy, Vanessa Nordyke, Deanna Gwyn and Jose Gonzalez voted against passing the payroll tax.
Mayor Chris Hoy and councilors Virginia Stapleton, Linda Nishioka, Trevor Phillips, and Micki Varney voted in favor of it.
The "Safe Salem" payroll tax is set to be imposed on wages for individuals working in Salem, regardless of where they live, as early as July 2024. The tax would not be imposed on those earning minimum wage.
A payroll tax calculator is available at egov.cityofsalem.net/PayrollTaxCalculator/. A person earning the average hourly rate of $29.90, which equates to $62,192 a year, would be taxed $42.19 a month — $506.24 a year.
The funds generated could only be used for community safety, which includes police services, fire, emergency medical services, 911 call services, code enforcement and unsheltered services.
Preston Mann, Oregon Business & Industries' director of political affairs and a Salem resident, filed the petition on July 14. The city approved OBI’s petition that same day.
“OBI is headquartered in Salem, and we care deeply about this community," said Angela Wilhelms, OBI’s president and CEO. "We have no problem with Salem or any other city asking voters to support levies for important local services."
Critics of the tax say it is burdensome and unclear. Proponents of it said it would be used to hire more police to decrease crime, hire more firefighters to reduce response time and maintain and expand existing homelessness services to keep people from living on the streets in unmanaged camps.
But Wilhelms said the proposal is vague, the tax is high, the administrative burden is significant, and there is little assurance as to how funds will be spent, adding:
"At a minimum, the community deserves a chance to vote."
More information on the effort can be found at LetSalemVote.com.
For questions, comments and news tips, email reporter Whitney Woodworth at wmwoodworth@statesmanjournal.com, call 503-910-6616 or follow on Twitter at @wmwoodworth
This article originally appeared on Salem Statesman Journal: Business group launches effort to refer Salem payroll tax to voters
