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Bill

SB 487

Relating to the repeal of the corporate activity tax; prescribing an effective date.

2025 Regular Session Introduced by David Smith

SB 487 eliminates Oregon's corporate activity tax on business gross receipts, removing a major revenue source without specifying how to replace hundreds of millions in annual state funding.

In committee upon adjournment.
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WeVote Research Nonpartisan
Bill Summary · SB 487

Legislative bill overview

SB 487 proposes to repeal Oregon's corporate activity tax (CAT), a tax on gross receipts of businesses with over $1 million in Oregon sales. The bill would eliminate this revenue source entirely and establishes an effective date for the repeal, though the specific effective date isn't detailed in the provided information.

Why this is important

Oregon's CAT generates significant state revenue (hundreds of millions annually) that funds schools, healthcare, and infrastructure. Repealing it would create a substantial budget gap requiring either spending cuts, alternative revenue sources, or both. The outcome affects both business operating costs and public service funding levels.

Potential points of contention

  • Revenue replacement: Eliminating CAT revenue without identifying replacement funding sources could force cuts to education, health services, or require raising other taxes
  • Business competitiveness claims vs. fiscal reality: Proponents argue lower taxes attract business, while critics note Oregon's tax rate is already competitive and repeal shifts burden to other taxpayers
  • Disproportionate impact: Smaller businesses and individual taxpayers may face higher relative tax burdens if CAT is replaced through income or sales tax increases rather than spending reductions

Compiled from official sources — confirm details with the bill’s official record.

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