Relating to an income tax surtax to fund emergency preparedness; prescribing an effective date; providing for revenue raising that requires approval by a three-fifths majority.
Summary
House Bill 2703 creates a new personal income tax surtax in Oregon to generate revenue for emergency preparedness and resiliency. The surtax is set at $9 per year per taxpayer, with a proration rule based on months worked during the tax year. It applies in addition to existing income tax liability, but taxpayers with income below the federal poverty guidelines are exempt.
The bill directs the Oregon Department of Revenue to collect the surtax using the same general reporting, audit, appeal, and confidentiality rules that apply to personal income taxes, while also specifying that the surtax is not subject to withholding or estimated tax payments. Revenue collected, after refunds, is transferred to the Resiliency Grant Fund, which is intended to support emergency preparedness-related purposes. The measure applies to tax years beginning on or after January 1, 2026, and takes effect 91 days after adjournment sine die.
Impact
HB 2703 would amend Oregon tax law by adding a new surtax provision to ORS chapter 316 and by redirecting the resulting revenue to the Resiliency Grant Fund under ORS 401.552. It would affect individual taxpayers, including nonresidents and taxpayers who change residency status during the year, and it would integrate the new surtax into existing tax administration and enforcement procedures. Because it raises revenue, the measure is subject to the constitutional three-fifths vote requirement for tax legislation.
Sentiment
Based on the bill text and available context, the measure appears to be framed as a modest, targeted revenue-raising proposal for emergency preparedness rather than a broad tax increase. There are no committee transcripts or recorded votes provided, so there is no documented debate or formal sentiment history in the materials. The bill’s structure, including the low dollar amount and poverty-guideline exemption, suggests an effort to limit burden while dedicating funds to resiliency purposes.
Contention
The main potential point of contention is the creation of a new income tax surtax, even though it is small, because any new tax can draw concern from taxpayers and anti-tax lawmakers. Another likely issue is whether the revenue should be raised through a broad-based surtax versus other funding mechanisms for emergency preparedness. The exemption for taxpayers below federal poverty guidelines may reduce equity concerns, but the bill still imposes a new obligation on most filers, including nonresidents, which could be debated.