For all its screw-ups, Oregon is damn good at one thing, raising taxes and fees.
One of the newest gambits, SB 687, would actually remove voters from the decision-making process. Sponsored by State Senator Sen. Khanh Pham, D-Portland, and State Representatives Mark Gamba, D- Milwaukie and Zach Hudson, D – Troutdale, Wood Village, Fairview and North Gresham, the bill would allow a city or county to enact a fuel tax without going to voters first, eliminating a current requirement that local voters must approve city or county gas tax increases.
I guess in the sponsors’ view, voters just get in the way of sound policymaking.
In a classic political gaffe, Gamba has already insulted voters, going so far as to tell OPB that voters too often act like “petulant children” standing in the way of taxes that are necessary to replace vital infrastructure like roads, sewage plants and libraries. “Someone needs to be the responsible adult in the room,” he told OPB.
Oregon‘s tax system already ranks in the bottom half of states, coming in 30th overall on the 2025 State Tax Competitiveness Index and Portland enjoys the distinction of having the highest combined local income tax rate in the nation (4 percent), adding an extra layer of tax burden for residents of the state’s largest city.
You may be thankful Oregon forgoes a sales tax, but the Competitiveness Index points out it doubles down on other forms of taxation. The state has a complex and progressive individual income tax system with four tax brackets, a top marginal rate of 9.9 percent, and a personal exemption structured as a tax credit. Additionally, the tax brackets are not adjusted for inflation.
The absence of a sales tax in Oregon is offset, the Index says, by an overly complex corporate tax system, which includes a 7.6 percent corporate income tax, a 0.57 percent gross receipts tax (the Corporate Activity Tax), and additional corporate taxes at the local level, particularly in the Portland area. Although gross receipts taxes typically do not allow any deductions from gross sales, the CAT provides a 35 percent deduction for either labor costs or the cost of goods sold. However, this does not significantly improve Oregon’s competitiveness in attracting businesses, as the state’s corporate tax system ranks among the worst in the nation, comparable to Delaware, the only other state to combine corporate income and gross receipts taxes.
Oregon’s property tax system is moderately competitive, the Index acknowledges, though the property tax burden relative to personal income is higher than in California and Washington. Additionally, the state imposes an estate tax with a maximum rate of 16 percent and the lowest estate tax exemption among states that levy the tax ($1 million), which further reduces the state’s competitiveness for high-net-worth individuals.
But what do the Democrats in the Legislature care? They have a supermajority in both the Oregon House and Senate, so they’ll be able to increase taxes and fees without a single Republican vote. The hell with ordinary voters, I guess.
