News & Insights
State of Play
Oregon is an extreme outlier. Although some policymakers and advocates wear the “high tax state” badge as an honor, it often goes without acknowledging the state’s income tax functions as a high-rate flat tax. At its most basic level, Oregon’s personal tax has a graduated or progressive marginal rate structure, ranging from 4.75 percent to 9.9 percent. On the other hand, the arrangement of those brackets effectively operates as a high-rate flat tax, imposing the second-highest rate of 8.75 percent on anyone with taxable income exceeding a mere $9,200.
Taxes usually take a back seat during interim meetings of the legislature, especially during election years. However, the hearings this week were an outlier, with the legislature openly discussing an end to a popular deduction, a new tax on business sales, and a looming proposal to raise $22 billion a year in taxes. Whew!
On Tuesday, May 17, Oregonians cast their ballots to nominate partisan candidates for the general election and nonpartisan state and local offices. Although much of the media’s attention focused on the high-profile candidate elections, voters also decided the fate of 57 local funding measures to pay for new and existing services.
Today, Oregon lawmakers once again received news that government revenues are continuing to boom, adding nearly $4 billion in total resources since the end of the last long session in 2021. In the latest revenue forecast, lawmakers were told to expect $427 million in combined new resources since the March forecast to spend during the 2023 session. Additionally, personal income taxpayers throughout the state will receive another historically high kicker credit of $3 billion.
Oregonians are unhappy with the status quo but do not associate blame with their incumbents at the end of the day. That was the key takeaway from last night’s election, where incumbents and the establishment mostly triumphed over candidates presenting themselves as outsiders. Up and down the ballot, from city and county races to the gubernatorial and congressional races, primary voters largely anointed the establishment class as their champions.
Three-in-five Oregonians say their state taxes are too high, according to a new poll commissioned by Oregon Public Broadcasting released on April 21. The poll, conducted by DHM Research, also reveals that 40 percent of voters believe the state spends too much on public services and should reduce taxes, which is a nine percent increase for the same question in less than a year.