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5.
Evasion a Higher Percentage of Gas Tax Revenue
. A mitigating factor to this
move would be the decreasing reliance on the gas tax as a major source of revenue for
ODOT. The portion of ODOT revenue represented by the gas tax will be declining as
alternative tax programs are used. Any evasion incurred, while a higher percentage
of gas tax revenue, will be a progressively smaller percentage of total revenue.
6.
Unsophisticated Taxpayers
. Moving to the retail level would result in an increase in
taxpayers from approximately 200 to 1000. The amount of tax reported would run
the gamut and there would be a marked increase in smaller accounts. Initial
observation indicates that this smaller segment of the fuel industry
is more susceptible
to late payments and business failures
than their larger, more sophisticated suppliers.
As such, bad debts would be more numerous but smaller in amount. If this move
becomes likely, further analysis should be done to determine an estimate, if possible,
of the amount of loss ODOT could expect to experience.
7.
New Computer System Needed
. The change would necessitate a new computer
system to handle the increased number of licensees/taxpayers and the radically
changed tax structure. Extensive involvement by ODOT's IS staff would be
necessary to accurately estimate the cost of developing such a system.
8.
Electronic Data Filing Problematic
. The transmission of data electronically
becomes both beneficial and problematic at the retail level. Electronic based filing
would reduce data entry costs and the errors that go with it, but the less sophisticated
base of taxpayers may be
less accepting of mandated or voluntary electronic filing.
9.
Increased Demand for Governmental Exemptions
. A retail based tax structure
could potentially encourage the demand for exemptions by governmental bodies from
the federal level down to the local level. Exemptions from the retail based use fuel
tax currently exists for virtually all governmental bodies in Oregon. The retail nature
of the use fuel tax has contributed to the relative ease of administering the tax
program with the exemptions, and
moving the gas tax to the retail level would likely
facilitate political pressure to extend the exemptions to the gas tax
. In addition, legal
advice would be needed to determine if the state's ability to tax the federal
government could be maintained.
10.
Bucks National Uniformity Trend
. Industry buy-in to a retail based tax structure is
unknown, but would be critical to it's success. The change would go against a
nationwide movement toward uniformity. Multi-state operators would likely be very
concerned with the `uniqueness' of the Oregon system as it
would require a reporting
structure
on their end
completely different from any other state
.
11.
Increased Costs to Other Governmental Entities
. ODOT currently administers
local tax ordinances for Washington and Multnomah Counties, and the City of
Woodburn. The tax structure of these ordinances mirrors existing state law. If the
