Oregon Legislature takes up payroll tax

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By J.L. Wilson, Associated Oregon Industries,
Oregon’s Largest Business Lobby

In a packed Senate hearing room, AOI delivered strong opposition this week to a new proposal that would tax Oregon workers to fund a paid family leave benefits program to be implemented by the state.  The new proposal – SB 966 – would tax Oregon workers at a rate of two cents per hour worked.  The proceeds of the new tax would allow Oregon workers who elect to take family leave to collect weekly paychecks in the amount of $300 for up to six weeks.  In its current form, the new tax and benefits in SB 966 only apply to workers who work in companies with 25 or more employees.

There is widespread business concern and opposition surrounding the new proposal.  AOI delivered testimony on behalf of the majority of Oregon employees who would be unfairly burdened with a new tax, but would have no need for the paid family leave benefit.  In its current form, the proposal relies on over 40 Oregon workers paying the new tax for every one worker who receives the full six weeks of paid benefits.  AOI also expressed concern that no professional actuarial work had been done in advance of the state’s interest in establishing a new insurance program.  AOI members have deep reservations about such paid family leave programs, believing such proposals to be ultimately unsustainable while requiring ever-increasing taxes.

AOI will continue to lead business opposition to SB 966.  In fact, over 20 business organizations have coalesced in opposition to the bill.  The prospects for passage of SB 966 remain unclear.  The battleground for passage of the bill will be the Oregon Senate, where several moderates in both parties have expressed the same reservations about the bill that AOI has.

Associated Oregon Industries,
Oregon’s Largest Business Lobby