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June 10, 2005

Let's Stop Phantom Taxation!

CUB is busy fighting the battle of the hour: making sure that utilities don't collect from ratepayers taxes they aren't going to pay. It isn't fair, it isn't sensible, and we want the practice to end.

Our battlefield is the Oregon State Legislature, where CUB has lent support to Senate Bill 408, which has passed the Senate and will hopefully pass the Oregon House in the next few weeks. SB 408 sets into state law the principle discussed above: The utility will have to earn its profit based on how well it operates the utility, not on how creative its tax accountants are. The bill instructs the PUC to examine whether there is a mismatch between taxes charged to ratepayers and taxes actually get paid. If there is a mismatch, the PUC will create an automatic adjustment mechanism which will more closely align the taxes collected and taxes paid.

Oregonian utility consumers have paid too many dollars into corporate coffers, only to see those dollars never reach the state or federal government they were intended to support. Instead, they have enriched shareholders. For example, PacifiCorp has collected taxes and Scottish Power has pocketed them; this is not small change, since it amounts to about $15 million per year. This may be legal, but it isn't right. The taxes a utility company collects from customers should not be significantly more than the amount that actually reaches the government. It's as simple as that.

PLEASE CALL (503-986-1000) or email (http://www.leg.state.or.us/findlegsltr/) your State Representative today. Tell them to vote YES on SB 408!

Posted by Oregon CUB at June 10, 2005 12:41 PM

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