Bill > SB63

This bill modifies Oregon's personal income tax structure by introducing a flat 4% tax rate for taxpayers with adjusted gross income below certain thresholds: $100,000 for joint returns and $50,000 for other types of returns, starting with tax years beginning on or after January 1, 2026. Currently, Oregon uses a graduated tax rate system with rates ranging from 4.75% to 9.9% depending on income levels. The bill maintains the existing tax calculation method for those above the specified income thresholds, while providing a lower flat rate for lower-income taxpayers. The legislation also includes provisions for adjusting tax brackets annually based on the cost-of-living adjustment, using the U.S. City Average Consumer Price Index. Technical amendments are made to related sections of tax law to accommodate the new tax rate structure, including updates to filing requirements and calculations for different taxpayer scenarios such as part-year residents and married couples filing jointly. The bill will take effect 91 days after the adjournment of the 2025 regular legislative session, giving taxpayers and tax authorities time to prepare for the new tax rates.

Budget and Finance

https://olis.oregonlegislature.gov/liz/2025R1/Measures/Overview/SB63