Governor Signs $1 Billion Small Business Tax Bill

SB 1528B negates state income tax relief for Oregon’s small businesses
  
The following business groups today expressed their disappointment in Gov. Kate Brown’s signing of Senate Bill 1528, which increases taxes on small business by more than $1 billion over six years. Statements follow.
 
Associated Oregon Loggers
Oregon-Columbia Chapter of Associated General Contractors
Oregon Farm Bureau Federation
Oregonians for Food & Shelter
Oregon Power Sports Association
Oregon Restaurant & Lodging Association
Oregon Seed Council
Oregon Small Woodlands Association
Oregon State Association of Plumbing-Heating-Cooling Contractors
Oregon Vehicle Dealers Association
National Association of Insurance and Financial Advisors-Oregon
NFIB/Oregon
Northwest Auto Trades Association
 
Jason Brandt, President & CEO for the Oregon Restaurant & Lodging Association:
“As Oregonians running restaurants and lodging establishments continue to assess their tax liability under the new federal reforms, one thing is painfully clear – there will be no state income tax relief for Oregon’s small businesses. Oregon had an opportunity to replicate and amplify the successes of federal tax reform by connecting to the new 20 percent deduction on pass-through business income – which would have happened automatically, without passing a single bill this year. This is a very unwelcome and disappointing development. Raising revenue should require a supermajority vote of Oregon’s legislature. ORLA will be actively involved in campaign activity this summer and fall to give Oregonians the opportunity to vote for an end to easy tax hikes.”
 
Anthony Smith, Oregon state director for the National Federation of Independent Business:
“Lower taxes mean more opportunities for entrepreneurs to make investments in their businesses, their communities, and their employees. NFIB remains committed to preserving every possible benefit from federal tax reform because the Tax Cuts and Jobs Act has led to a significant surge in Small Business Optimism across the nation, reaching some of the highest levels on record. Unfortunately, Oregon has chosen a different path. Today’s signing of SB 1528 marks a significant step backwards for our state’s entrepreneurs.
 
Cathi Webb, Executive Director for the Northwest Auto Trades Association:
“It’s sad to see Oregon moving in the wrong direction. We were once a leader in recognizing the importance of providing tax relief to our homegrown, main street businesses. Now, Congress and the White House have raised the bar with an inclusive policy that lowers taxes for nearly every S-corp, partnership, LLC, and sole proprietorship. We could have done the same. We didn’t.”
 
Jonathan Sandau, State Government Affairs for the Oregon Farm Bureau Federation:
“The state’s decision to decouple from the federal tax code jeopardizes our local farmers’ economic competitiveness by blocking the full benefits that could have been realized from federal tax reform. By keeping those dollars on the farm, Oregon’s small farming and ranching families had an opportunity to engage on a level playing field to provide healthy, responsibly grown food to our local markets.”
 
Jim Geisinger, Executive Vice President for Associated Oregon Loggers:
“The state asks small businesses to pay more and more of the state’s obligations while making it more and more difficult to make a buck to tax! They can’t have it both ways!”
 
Roger Beyer, Executive Director for the Oregon Seed Council:
“For Oregon’s family owned farms this is a real blow. Unlike many other businesses, farms cannot pick up and leave the state if it is unprofitable to continue doing business. The state has increased the cost of producing seed significantly in recent years and today, the Governor showed us where her loyalties lie. This was a missed opportunity for Oregon.”
 
Background
According to the non-partisan Legislative Revenue Office, SB 1528B raises $244.4 million in 2017-19, $376.7 million in 2019-21, & $427.4 million in 2021-23, a total of more than $1 billion in additional revenue that was not part of the most recent state revenue forecast.
 
The U.S. Small Business Administration reports that Oregon has over 350,000 small businesses, accounting for 99.4 percent of all businesses in the state and employing more than half of the state’s private sector workforce. The median income for individuals self-employed at their own incorporated businesses was $44,147 in 2015. For individuals self-employed at their own unincorporated firms, this figure was $20,672, including all income sources.

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About the Oregon Restaurant & Lodging Association
The Oregon Restaurant & Lodging Association serves to protect and promote Oregon’s hospitality industry, representing approximately 2,500 members, and advocating for over 9,900 foodservice locations and 2,200 lodging establishments across the state. The foodservice and lodging industry is responsible for 173,700 jobs bringing in over $10.8 billion in annual sales and generates over 54% of the annual tourism dollars spent in Oregon.

About the National Federation of Independent Business
Celebrating its 75th anniversary, the National Federation of Independent Business has taken the message from Main Street to the halls of Congress and all 50 state legislatures since 1943. NFIB annually surveys its members on state and federal issues vital to their survival as America's economic engine and biggest creator of jobs. NFIB’s educational mission is to remind policymakers that small businesses are not smaller versions of bigger businesses; they have very different challenges and priorities. 

If you have questions or concerns, contact Jason Brandt, President and CEO, Oregon Restaurant & Lodging Association, 503.682.4422, JBrandt@OregonRLA.org.