A TFO analysis of Oregon’s regime for pass-through income finds that it achieves no discernible goal. It saves affected taxpayers inconsequential amounts, costs the state more than a hundred million dollars per year, and violates statutory guidelines providing for “the same tax burden on all households earning the same income.” This analysis is intended as a guide in reviewing 2021 proposals to reform it.
LRO presented data for 2018 for a January 26 hearing of the Senate Finance and Revenue Committee. We have calculated the share of total claimants and the average claim per income bracket. It is important to note that the income brackets include total income from all sources. Business income receiving favorable tax treatment could be a small slice or virtually all of a taxpayer’s total income. …Read the full study