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Learn The Tax Climate In Oregon

Monika Miles - Tax Climate In Oregon

Oregon, also known as the Beaver state, is located in the Pacific Northwest region of the West coast of the United States. The Columbia River delineates much of Oregon’s northern boundary with Washington, while the Snake River delineates much of its eastern boundary with Idaho. Oregon is one of only three states of the contiguous United States to have a coastline on the Pacific Ocean.

Oregon is one of the most geographically diverse states in the U.S., marked by volcanoes, abundant bodies of water, dense evergreen and mixed forests, as well as high deserts and semi-arid shrublands. At 11,249 feet, Mount Hood, a volcano, is the state’s highest point. Oregon’s only national Park, Crater Lake National Park, comprises the caldera surrounding Crater Lake, the deepest lake in the United States. The state is also home to the single largest organism in the world Armillaria ostoyae, a fungus that runs beneath 2,200 acres of the Malheur National Forest.

Business Climate

Because of its diverse landscape and waterways, Oregon’s economy is largely powered by various forms of agriculture, fishing, and hydroelectric power. Oregon is also the top timber producer of the contiguous United States, and the timber industry dominated the state’s economy in the 20thcentury. Technology is another one of Oregon’s major economic forces, beginning in the 1970s with the establishment of the Silicon Forest and the expansion of Tektonix and Intel.

Oregon is one of four major hazelnut growing regions, and produces 95% of the domestic hazelnuts in the United States. While the history of the wine production in Oregon can be traced to before Prohibition, it became a significant industry beginning in the 1970s. Due to regional similarities in climate and soil, the grapes planted in Oregon are often the same varieties found in the French regions of Alsace and Burgundy.

In the southern Oregon coast, commercially cultivated cranberries account for about 7% of U.S. production, and the cranberry ranks 23rd among Oregon’s top 50 agricultural commodities. In the northeastern region of the state, particularly around Pendleton, both irrigated and dry land wheat is grown. Oregon farmers and ranchers also produce cattle, sheet, dairy products, eggs and poultry.

Oregon is also the home of large corporations. The world headquarters of Nike are located near Beaverton. Medford is home to Harry and David, which sells gift items under several brands. Adidas Corporations American Headquarters is located in Portland.

Oregon has also historically been a popular region for film shoots due to its diverse landscapes, as well as its proximity to Hollywood. Some movies filmed in Oregon include Animal House, Free Willy, The General, The Goonies, Kindergarten Cop, One Flew Over the Cuckoo’s Nest and Stand By Me.

Tax Climate  

Oregon’s top individual income tax rate is 9.9%. The top corporate income tax rate is 7.6%.

In Oregon, taxpayers apportion income using a single-sales factor formula. A corporation primarily engaged in a utility or telecommunications business may elect to apportion business income using the double-weighted sales factor and single-weighted property and payroll factor apportionment formula by completing Schedule AP, Apportionment of Income for Corporations and Partnerships, using that formula on an original or amended return. Oregon began the move to a single sales factor with the enactment of 1989 Or. H.B. 2643, which adopted double-weighting of the sales factor effective for tax years beginning on or after Jan. 1, 1991.

Receipts from services are sourced based on the location of the taxpayer’s market for the service. For tax year’s beginning on or after Jan. 1, 2018, Oregon adopts market-based sourcing for receipts from other than sales of tangible personal property. For receipts from services, a taxpayer’s market is in Oregon if and to the extent the service is delivered to a location in the state. The term “delivered to a location” refers to the location of the taxpayer’s market for the service, which may not be the location of the taxpayer’s employees or property.

Sales Tax Structure  

Oregon is one of five states that does not administer a sales tax. Over the years, Oregon voters have rejected a sales tax at least 9 times.

Random Facts

  • Portland is home to the oldest zoo west of the Mississippi River.
  • The Sea Lion Caves in Florence are the largest in the world and were discovered in 1880.
  • There are nine lighthouses standing along the coastline. Five are still being used; the others are designated historic monuments.
  • Silver Falls State Park is Oregon’s largest state park. It features 10 waterfalls and contains a wide variety of forested hiking trails.
  • A treaty between the United States and Spain established the current southern border between Oregon and California. The treaty was signed in 1819.
  • The best windsurfing in the world is found in Oregon’s Columbia River Gorge.
  • Forest Grove, Oregon is home to the world’s tallest barber shop pole.
  • At 8,000 feet deep Oregon’s Hells Canyon is the deepest river gorge in North America.

Have a tax question? Contact Monika Miles.



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