An Analysis of SB 535's Proposed Corporate and Personal Income Tax Capital Gains Tax Cut

June 16, 1999 Download PDF

Executive Summary

The OCPP asked the Washington, D.C.-based Institute on Taxation and Economic Policy (ITEP) to analyze the impact of SB 535-A on households in Oregon using ITEP's nationally recognized microsimulation tax model.

Currently, Oregon's personal income tax subjects capital gains to the same graduated structure as all other sources of income. SB 535 would create a separate, lower rate of 4 percent for income from capital gains, while taxing wages, self-employment income, and other income at the current higher rates. SB 535 would also reduce the corporate income tax rate by over one-third, from 6.6 percent to 4 percent. ITEP, the state Legislative Assembly's Legislative Revenue Office, and the bill's proponent, Associated Oregon Industries, have yet to calculate the impact of the novel corporate capital gains tax cut.

An analysis of the personal income tax reduction in SB 535-A Engrossed finds that:

The OCPP is distributing this analysis to the public, the press, and legislators to help develop an informed opinion on this issue. Please do not hesitate to contact the OCPP if you have any questions or need additional information.