How Oregon Made Facing Tax Day a Bit More Bearable

Three legislative initiatives, now law, will be especially helpful to small businesses
By Oregon NFIB,

SALEM, Ore., April 11, 2022—Few are the number of people who face Tax Day with any joy, but in a statement released today by the Oregon state director for America’s largest small-business association, Oregonians can at least approach this Tax Day and future ones with a little less foreboding.

“Now that the work of the 81st Oregon Legislative Assembly has drawn to a close, I think it worth reminding everyone of three significant pieces of legislation that were enacted, which make facing Tax Day a bit more bearable,” said Anthony Smith, Oregon state director for the National Federation of Independent Business (NFIB).

From the 2021 session:

• Senate Bill 164 made important technical changes to the Corporate Activity Tax (CAT), Oregon’s gross receipts tax enacted in 2019. Most notably, the bill allows taxpayers who use an annual accounting period (fiscal year) for federal income tax purposes as their CAT filing year, rather than the standard calendar year, thereby significantly decreasing administrative burdens. The bill also provides some limited benefits to certain industry categories, like car dealers, grocery consignment businesses, and insurance companies headquartered in the state.

• House Bill 3389 provides Oregon employers with much needed unemployment insurance tax relief, holding businesses as harmless as possible for pandemic-related layoffs, while at the same time providing partial deferral and forgiveness for 2021 tax increases. The Employment Department estimates that HB 3389 will save Oregon employers $2.4 billion through 2029.
From the 2022 session:

• Senate Bill 1524 refines and clarifies the state’s Business Alternative Income Tax, a voluntary tax program that allows qualifying business owners to reduce their federal income tax liability at no cost to the state – a State and Local Tax (SALT) workaround – and instructs the Oregon Department of Revenue to adopt rules providing relief from penalties if sufficient estimated payments are made by either a pass-through entity or its members. The bill also makes changes to Oregon’s Corporate Activity Tax (CAT) which include administrative technical changes to accommodate businesses filing CAT returns using a fiscal year that differs from the calendar year and exempts sales of prescription drugs sold by local independent pharmacies with nine or fewer locations in Oregon.

NFIB lobbied for all three bills, but Smith said the credit for their passage goes to NFIB’s small-business-owning members who support NFIB’s work to pass pro-small business legislation and oppose efforts to make Oregon a more difficult and costly state to do business. “Our members always rally when called upon. We couldn’t do this important work without them – and it’s because of them that every small-business owner in Oregon is able to save more of their time and money.”

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