The City of Portland’s approval of a tax on companies with high-paying CEOs continues to draw attention, but not everyone thinks it will work.
On December 8, Portland’s city council approved a tax on public companies that pay their chief executives far more than they pay an average worker.
It’s the first of its kind tax on public companies with big salaries for CEOs.
Portland Commissioner Steve Novick told Neil Cavuto on Fox News that he is trying to “make America great again.”
“Extreme economic inequality is, next to global warming, the biggest problem of our time,” claimed Novak. “The richest one percent, and especially the richest one-tenth of one percent, have far more income and wealth and power than they did 40 years ago and it’s been economically destabilizing, sociality destabilizing, politically destabilizing…”
In the 1960s for example, Novik said, the typical CEO made about 20 times what the typical worker made.
When asked whether this may cause companies to leave or not do business in Portland, Novick said that would not happen.
According to The Associated Press, the tax approved in Portland targets publicly traded companies whose CEOs report salaries at least 100 times higher than the salary of a median worker.
Under the ordinance, a company with a CEO-to-worker ratio of at least 100-to-1 will pay a surcharge equal to 10 percent of the amount it pays for Portland’s business tax.
Officials expect the tax to raise $2.5 million year once it starts in January 2017
In a related interview Dec. 12 on Crane Durham’s “Nothing But Truth” program, Pete Sepp of the National Taxpayers Union said there is evidence that large businesses do respond in that way to other laws.
“There were plans for Walmart to locate two stores in the District of Columbia and its environs,” Sepp explained. “Walmart decided to pull out of the deal after talk of a living wage law requiring Walmart, and others of a certain size, to pay a certain amount of money to each and every employee.”
What about the income disparity?
“Maybe the disparity is too great and maybe the market needs to sort out that question,” Sepp answered. “I can tell you this: doing it through the tax system with punitive rates hasn’t worked and won’t work.”
Copyright OneNewsNow.com. Reprinted with permission.