A new report  from the Sightline Institute in Seattle shows that Oregon income taxes are the highest in the nation.  However, Oregonian’s overall tax burden is lower than the national average because we don’t have a sales tax.

 

What impact does this type of tax system have on the ability of Oregon to attract and retain high income individuals?  Will we ever be able to adopt a more balanced tax structure?

Last year, ECONorthwest did research on the migration of individuals between Oregon and Washington.  The research points to outflows of high-income earners to Clark County, Washington from Multnomah, Clackamas, and Washington County Oregon.

Note that the incomes of folks moving out of Oregon into Clark County, WA are significantly higher than those coming from Clark County into Oregon.  The only year that the difference was negligable was 2001-the year of a stock market crash.

 

Many things impact the competitiveness of an economy and the incomes of individuals including the quality of higher education, available industrial land, regulatory processes, infrastructure,etc.

But is Oregon’s tax policy at least partially responsible for our low per capita income compared to other states?

Share your thoughts.

Update:  I just found another report from Sightline that makes the point that wealthy individuals actually flock to high income tax states.  However, Oregon is missing from their analysis.