Personal Income Tax​​​

Oregon residents and nonresidents who earn income in Oregon pay personal income tax. During the 2019 Legislative Session, the Legislature passed the Student Success Act (House Bill 3427), which created a Corporate Activity Tax (CAT) dedicated to school funding. Effective beginning tax year 2020, the Legislature reduced Oregon’s first three income tax brackets from 5%, 7%, and 9%, to 4.75%, 6.75%, and 8.75% respectively. After deductions and credits, the average effective tax rate is about 6.0% of adjusted gross income. Since 1993, the income tax brackets have been indexed to changes in the Consumer Price Index. The current standard deduction for tax year 2024 is $5,495 on joint returns, $2,745 on single and married filing separate returns, and $4,420 for a head of household return. Blind or elderly taxpayers, persons over the age of 65, will receive an additional $1,200 standard deduction on a single return and an additional $1,000 per eligible person on a joint return. 

The personal income tax is the largest source of state tax revenue and projected to comprise 86% of the total General Fund revenues in the 2025-2027 biennium, a 4% decrease from the 2023-2025 biennium. Blind or elderly taxpayers and persons over the age of 65, will receive an additional $1,200 standard deduction on a single return and an additional $1,000 per eligible person on a joint return. 

In January 2010, Oregon voters approved Ballot Measure 66, which made two changes to personal income tax calculations. First, it established new tax brackets for adjusted gross incomes above $125,000 (single filers) and $250,000 (joint filers) and phased out the federal tax subtraction for those same filers. Second, it allowed a one-year tax exclusion for the first $2,400 of unemployment benefits, as is permitted in federal tax law.​

Business Taxes

Corporations that do, or are authorized to do, business in Oregon pay an excise tax. Corporations not doing, or that are not authorized to do, business in Oregon, but that have income from an Oregon source, pay a corporate income tax. The corporate excise and income tax is the second largest source of state tax revenue. The tax rate is 6.6% on Oregon taxable income of $1 million or less and 7.6% on Oregon taxable income above $1 million. There is a minimum excise tax of $150.​

Corporate Activity Tax

The Oregon Legislature passed House Bill 3427 (2019) referred to as the Student Success Act, which in turn created the Corporate Activity Tax (CAT). CAT funding created through this bill is a 0.57% tax on commercial activity in Oregon above $1 million dedicated to schools and early learning programs. The bill contained a reduction of 0.25% for the bottom three personal income tax brackets. Based on the June 2024 revenue forecast, the corporate activity tax is expected to generate around $2.8 billion during the 2023-2025 biennium.

Property Tax

Property tax rates differ across Oregon. The rate depends on the tax rate approved by local voters and the limits established by the Oregon Constitution. Most properties are taxed by a number of districts, such as a city, county, school district, community college, fire district or port. The total tax rate on any particular property is calculated by adding all the local taxing district rates in the area, then multiplied by the assessed value of the property. The county assessor verifies the tax rates and levies submitted by each local taxing district on an annual basis. The county tax collector collects the taxes and distributes the funds to the local districts. 

Taxable property includes real property, mobile homes, and some tangible personal property used by business. The state and each county assessor determine the value of property in each county. Measure 5, which was passed in November 1990, restricted non-school taxes on any property to $10 per $1,000 of real market value. It restricted school taxes on any property to $5 per $1,000 of real market value. 

Measure 50 was passed in May 1997. Measure 50 added another limit to the Measure 5 limits. Now, each property has a real market value and an assessed value. Each taxing district has a fixed, permanent tax rate for operations. Districts may not increase this rate. Voters can approve local option levies for up to five years for operations and up to 10 years or the useful life of capital projects, whichever is less. Local option levies require a “double majority” for approval. Measure 50 established the 1997–1998 maximum assessed value as 90% of a property’s 1995–1996 real market value. In subsequent tax years, the assessed value is limited to 3% annual growth until it reaches real market value. The assessed value can never exceed real market value. New property is assessed at the average county ratio of assessed to real market value of existing property of the same class. For fiscal year 2022–23, for all classes of property statewide, total assessed value was about 52% of real market value.​