No perfect tax.

Byline: The Register-Guard

There are many types of fire extinguishers, each with its respective advantages and limitations. But when your sofa catches fire, you don't drive to the hardware store to shop for the perfect extinguisher. You use the one you have.

In recent weeks, critics of Lane County Measure 20-114 have noted several problems with the proposed income tax that's the extinguisher county officials have chosen to put out the fiscal flames that are devouring the county's public safety system.

For example, a Nov. 1 guest viewpoint by V. Joseph Bowman Jr. pointed out that property-rich county residents would pay significantly less than those with similar fixed incomes but modest property holdings. Likewise, companies with high assessed property values would receive hefty property tax credits that could greatly offset their income tax liabilities.

Mailbag contributors have lambasted the proposal for making public sector retirement benefits exempt from the income tax, including county officials' own Public Employees Retirement System benefits. Even though the exemption was required under state law, it's a feature that has turned off many voters, in particular private-sector retirees who would still be required to pay the income tax.

The county's proposal has other deficiencies, real or perceived, as well as a substantial list of positive attributes that already have been noted on this page. Similar pro-con lists could also be made for every one the taxation options available to the county. Not one of them is without warts, wrinkles and other impediments. There is no perfect tax.

If the county had opted for a retail sales tax, one of two revenue options recommended by the county's Public Safety Task Force, the criticism would have been even more intense. Like the income tax, a sales tax has no precedent among Oregon counties. Unlike the income tax, a sales tax would have been regressive, imposing a disproportionate burden on low-income households. Administrative costs typically run high for sales taxes, and they impose a collection burden on businesses. Not to mention that sales taxes are automatically DOA at the polls.

A gross receipts tax, another task force recommendation, has its own list of negatives. Such a tax would unfairly saddle businesses with the cost of public safety improvements that benefit the entire community, and would impose a hardship on emerging businesses by taxing gross receipts rather than profits.

The property tax has become highly problematic in the post-Measure 5 era. A major new county levy would put many cities into compression, forcing the county to either compensate local governments for their losses or face their lethal opposition at the polls. Property taxes are also capped at 3 percent annual growth under the Oregon Constitution, a rate of growth that cannot keep pace with increasing public safety costs.

The other tax options - they include a restaurant tax, a business license tax, an amusement and entertainment tax and others - also have their inherent problems. There's not a perfect one in the bunch.

In retrospect, county officials might have crafted a better tax proposal than the one on next Tuesday's ballot. For example, they could have avoided a backlash over the exemption of PERS benefits by exempting both public and private sector benefits. They might have devised a mechanism to prevent individuals and companies with limited incomes but high property values from reaping unintended benefits - or they could have eliminated the credit for property taxes.

They could not possibly, however, have come up with a proposal that would be free of problems and immune to criticism. There is no perfect tax. But there is a perfectly clear need to fix a public safety system that's perilously stretched to the limit. The county's proposed solution is a workable solution - and the only one at hand - to meet an irrefutable need.