Tennis News: Maria Sharapova and Nike, Taxes and Nike
Oregon Governor John Kitzhaber knows just how important Nike is to his state so he recently asked the legislature to give him the authority to sign a deal with the footwear and apparel giant Nike where the state won’t change the formula used to levy corporate income taxes on the firm.
Nike is one of only two Fortune 500 companies in Oregon along with Intel and employs some 8,000 workers in the state. Nike is said to be the world’s largest sporting-goods company.
The Oregonian (newspaper) reports that before 1991, multi-state corporations doing business in Oregon were taxed under a formula based on their sales, payroll and property in the state. Then the state began taxing corporations only on their in-state sales.
Nike sells most of their products outside the state and doesn’t report what it pays in Oregon corporate taxes. But the Oregon Center for Public Policy says its tax burden is $20 million less than it would have been under pre-1991 laws.
However, Kitzhaber and the executives from two Oregon business associations argue that Oregon depends heavily on companies that make products for out-of-state consumption, and that Oregon receives more in personal income taxes from Nike employees than what it gives up in corporate taxes.
It appears that most of Oregon’s legislators are behind the deal.
Kitzhaber has said he wants to offer Nike assurances in exchange for getting the company’s promise to expand in Oregon.
Nike 2012 revenues totaled $24.1 billion, while annual earnings equaled $4.73 per share.
The company recently announced a 2-for-1 stock split and boosted its dividend by 17 percent. It’s stock was trading at around $97 on Thursday.
In November, it agreed to sell its Cole Haan fashion brand to private-equity firm Apax Partners for $570 million.
Maria Sharapova has been one of the faces of Cole Hahn. It is unclear how the deal will affect her contract.