Bill Text: OR HB2456 | 2013 | Regular Session | Engrossed
Bill Title: Relating to taxation; prescribing an effective date; providing for revenue raising that requires approval by a three-fifths majority.
Sponsorship: Committee Bill
Status: (Failed) 2013-07-08 - In committee upon adjournment. [HB2456 Detail]
Download: Oregon-2013-HB2456-Engrossed.html
77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1222
B-Engrossed
House Bill 2456
Ordered by the Senate June 29
Including House Minority Report Amendments dated April 22 and
Senate Amendments dated June 29
Introduced and printed pursuant to House Rule 12.00. Presession
filed (at the request of House Interim Committee on Revenue)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
{ - Requires corporations that file Oregon tax return and
include unitary corporation that is incorporated in certain
jurisdictions to include income from those jurisdictions in
Oregon tax return. Directs Department of Revenue to submit report
to Legislative Assembly on or before January 1 of each
odd-numbered year on recommended changes to list of such
countries. Requires that department estimate resulting revenue
received due to inclusion of income and provides that resulting
revenue be transferred to Mental Health Services Fund. - }
{ - Applies to tax years beginning on or after January 1,
2014. - }
{ + Declares legislative intent regarding distribution of
increased revenues resulting from certain changes in tax law
contained in Act.
Modifies income tax treatment of elderly medical expenses.
Converts itemized deduction to subtraction from federal taxable
income. Phases out amount of subtraction based on income.
Increases age restriction over time.
For purposes of personal income taxation, corrects amount of
federal income tax subtraction allowed for taxpayers who are
husband and wife filing separate tax returns. Phases out
availability of personal exemption credit for taxpayer with
federal adjusted gross income of $100,000 or more for single
return, or $200,000 or more for joint return. Eliminates personal
exemption credit for taxpayer with federal adjusted gross income
of $125,000 or more for single return, or $250,000 or more for
joint return. Increases corporate excise tax rate on taxable
income above $2.5 million.
Applies to tax years beginning on or after January 1, 2013.
Increases percentage of federal earned income credit allowable
as credit against Oregon personal income tax. Applies increase to
tax years beginning on or after January 1, 2013, and before
January 1, 2014.
Increases tax on cigarettes. Distributes tax revenues from
increase on cigarette tax to Oregon Health Authority for mental
health programs. Increases tax on other tobacco products. Applies
to distributions of cigarettes and other tobacco products
occurring on or after January 1, 2014.
Increases rate above which revenue from corporate excise tax
for tax years beginning on or after January 1, 2013, is to be
deposited in Oregon Rainy Day Fund. + }
Takes effect on 91st day following adjournment sine die.
A BILL FOR AN ACT
Relating to taxation; creating new provisions; amending ORS
315.266, 316.085, 316.695, 317.061, 317.853, 318.074, 323.030,
323.455, 323.505 and 323.625; prescribing an effective date;
and providing for revenue raising that requires approval by a
three-fifths majority.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + The intent of the Legislative Assembly in
enacting sections 2, 6 and 11 to 14 of this 2013 Act and the
amendments to statutes by sections 3 to 5 and 7 to 10 of this
2013 Act is that the increased revenues that result from the
changes in tax law contained in those sections and that are
received during the 2013-2015 biennium shall provide funding,
through appropriation or otherwise, as follows:
(1) $100 million for the State School Fund.
(2) $40 million for the funding of community colleges and
higher education.
(3) $40 million for services to senior citizens.
(4) $20 million for mental health services. + }
SECTION 1a. { + Section 2 of this 2013 Act is added to and
made a part of ORS chapter 316. + }
SECTION 2. { + (1)(a) In addition to the other modifications
to federal taxable income contained in this chapter, there shall
be subtracted from federal taxable income the amount paid for
medical care of the taxpayer and not compensated for by insurance
or otherwise, as described in section 213 (a) of the Internal
Revenue Code, if the taxpayer meets the age requirement for the
tax year under subsection (2) of this section. The amount
subtracted under this section may not exceed:
(A) $3,600 for a joint return if both spouses meet the age
requirement for the tax year under subsection (2) of this
section, with no more than $1,800 attributable to the medical
care of either spouse;
(B) $1,800 for a joint return if only one spouse meets the age
requirement for the tax year under subsection (2) of this
section; or
(C) $1,800 for each individual filing a return who meets the
age requirement for the tax year under subsection (2) of this
section.
(b) The subtraction under this section may not include amounts
that have previously been deducted in the calculation of Oregon
taxable income.
(2) The subtraction under this section is available only if the
taxpayer has attained the following age before the close of the
tax year:
(a) For tax years beginning on or after January 1, 2013, and
before January 1, 2014, a taxpayer must attain 62 years of age
before the close of the tax year.
(b) For tax years beginning on or after January 1, 2014, and
before January 1, 2016, a taxpayer must attain 63 years of age
before the close of the tax year.
(c) For tax years beginning on or after January 1, 2016, and
before January 1, 2018, a taxpayer must attain 64 years of age
before the close of the tax year.
(d) For tax years beginning on or after January 1, 2018, and
before January 1, 2020, a taxpayer must attain 65 years of age
before the close of the tax year.
(e) For tax years beginning on or after January 1, 2020, a
taxpayer must attain 66 years of age before the close of the tax
year.
(3) Notwithstanding the amount calculated under subsection (1)
of this section, the maximum amount allowed for a subtraction
under this section may not exceed:
(a) $1,400, if the federal adjusted gross income of the
taxpayer for the tax year is $50,000 or more and less than
$100,000 for a taxpayer who files a return jointly, as a head of
household or as a surviving spouse, or for all other taxpayers,
$25,000 or more and less than $50,000.
(b) $1,000, if the federal adjusted gross income of the
taxpayer for the tax year is $100,000 or more and less than
$200,000 for a taxpayer who files a return jointly, as a head of
household or as a surviving spouse, or for all other taxpayers,
$50,000 or more and less than $100,000.
(4) A subtraction may not be claimed under this section if the
federal adjusted gross income of the taxpayer for the tax year
exceeds:
(a) $200,000 for joint return filers, a surviving spouse or a
head of household; or
(b) $100,000 for an individual who is not a married individual
and is not a surviving spouse, or is a married individual who
files a separate return. + }
SECTION 3. ORS 316.695 is amended to read:
316.695. (1) In addition to the modifications to federal
taxable income contained in this chapter, there shall be added to
or subtracted from federal taxable income:
(a) If, in computing federal income tax for a { - taxable - }
{ + tax + } year, the taxpayer deducted itemized deductions, as
defined in section 63(d) of the Internal Revenue Code, the
taxpayer shall add the amount of itemized deductions deducted
(the itemized deductions less an amount, if any, by which the
itemized deductions are reduced under section 68 of the Internal
Revenue Code).
(b) If, in computing federal income tax for a { - taxable - }
{ + tax + } year, the taxpayer deducted the standard deduction,
as defined in section 63(c) of the Internal Revenue Code, the
taxpayer shall add the amount of the standard deduction deducted.
(c)(A) From federal taxable income there shall be subtracted
the larger of (i) the taxpayer's itemized deductions or (ii) a
standard deduction. Except as provided in subsection (8) of this
section, for purposes of this subparagraph, 'standard deduction '
means the sum of the basic standard deduction and the additional
standard deduction.
(B) For purposes of subparagraph (A) of this paragraph, the
basic standard deduction is:
(i) $3,280, in the case of joint return filers or a surviving
spouse;
(ii) $1,640, in the case of an individual who is not a married
individual and is not a surviving spouse;
(iii) $1,640, in the case of a married individual who files a
separate return; or
(iv) $2,640, in the case of a head of household.
(C)(i) For purposes of subparagraph (A) of this paragraph for
tax years beginning on or after January 1, 2003, the Department
of Revenue shall annually recompute the basic standard deduction
for each category of return filer listed under subparagraph (B)
of this paragraph. The basic standard deduction shall be computed
by dividing the monthly averaged U.S. City Average Consumer Price
Index for the 12 consecutive months ending August 31 of the prior
calendar year by the average U.S. City Average Consumer Price
Index for the second quarter of 2002, then multiplying that
quotient by the amount listed under subparagraph (B) of this
paragraph for each category of return filer.
(ii) If any change in the maximum household income determined
under this subparagraph is not a multiple of $5, the increase
shall be rounded to the next lower multiple of $5.
(iii) As used in this subparagraph, 'U.S. City Average Consumer
Price Index' means the U.S. City Average Consumer Price Index for
All Urban Consumers (All Items) as published by the Bureau of
Labor Statistics of the United States Department of Labor.
(D) For purposes of subparagraph (A) of this paragraph, the
additional standard deduction is the sum of each additional
amount to which the taxpayer is entitled under subsection (7) of
this section.
(E) As used in subparagraph (B) of this paragraph, ' surviving
spouse' and 'head of household' have the meaning given those
terms in section 2 of the Internal Revenue Code.
(F) In the case of the following, the standard deduction
referred to in subparagraph (A) of this paragraph shall be zero:
(i) A husband or wife filing a separate return where the other
spouse has claimed itemized deductions under subparagraph (A) of
this paragraph;
(ii) A nonresident alien individual;
(iii) An individual making a return for a period of less than
12 months on account of a change in the individual's annual
accounting period;
(iv) An estate or trust;
(v) A common trust fund; or
(vi) A partnership.
(d) For the purposes of paragraph (c)(A) of this subsection,
the taxpayer's itemized deductions are the { - sum of: - }
{ - (A) - } { + amount of + } the taxpayer's itemized
deductions as defined in section 63(d) of the Internal Revenue
Code (reduced, if applicable, as described under section 68 of
the Internal Revenue Code) minus the deduction for Oregon income
tax (reduced, if applicable, by the proportion that the reduction
in federal itemized deductions resulting from section 68 of the
Internal Revenue Code bears to the amount of federal itemized
deductions as defined for purposes of section 68 of the Internal
Revenue Code) { + . + } { - ; and - }
{ - (B) The amount that may be taken into account under
section 213(a) of the Internal Revenue Code, not to exceed seven
and one-half percent of the federal adjusted gross income of the
taxpayer, if the taxpayer has attained the following age before
the close of the taxable year, or, in the case of a joint return,
if either taxpayer has attained the following age before the
close of the taxable year: - }
{ - (i) For taxable years beginning on or after January 1,
1991, and before January 1, 1993, a taxpayer must attain 58 years
of age before the close of the taxable year. - }
{ - (ii) For taxable years beginning on or after January 1,
1993, and before January 1, 1995, a taxpayer must attain 59 years
of age before the close of the taxable year. - }
{ - (iii) For taxable years beginning on or after January 1,
1995, and before January 1, 1997, a taxpayer must attain 60 years
of age before the close of the taxable year. - }
{ - (iv) For taxable years beginning on or after January 1,
1997, and before January 1, 1999, a taxpayer must attain 61 years
of age before the close of the taxable year. - }
{ - (v) For taxable years beginning on or after January 1,
1999, a taxpayer must attain 62 years of age before the close of
the taxable year. - }
(2)(a) There shall be subtracted from federal taxable income
any portion of the distribution of a pension, profit-sharing,
stock bonus or other retirement plan, representing that portion
of contributions which were taxed by the State of Oregon but not
taxed by the federal government under laws in effect for tax
years beginning prior to January 1, 1969, or for any subsequent
year in which the amount that was contributed to the plan under
the Internal Revenue Code was greater than the amount allowed
under this chapter.
(b) Interest or other earnings on any excess contributions of a
pension, profit-sharing, stock bonus or other retirement plan not
permitted to be deducted under paragraph (a) of this subsection
{ - shall - } { + may + } not be added to federal taxable
income in the year earned by the plan and { - shall - }
{ + may + } not be subtracted from federal taxable income in the
year received by the taxpayer.
(3)(a) Except as provided in subsection (4) of this section,
there shall be added to federal taxable income the amount of any
federal income taxes in excess of the amount provided in
paragraphs (b) to (d) of this subsection, accrued by the taxpayer
during the { - taxable - } { + tax + } year as described in
ORS 316.685, less the amount of any refund of federal taxes
previously accrued for which a tax benefit was received.
(b) The limits applicable to this subsection are:
(A) $5,500, if the federal adjusted gross income of the
taxpayer for the tax year is less than $125,000, or, if reported
on a joint return, less than $250,000.
(B) $4,400, if the federal adjusted gross income of the
taxpayer for the tax year is $125,000 or more and less than
$130,000, or, if reported on a joint return, $250,000 or more and
less than $260,000.
(C) $3,300, if the federal adjusted gross income of the
taxpayer for the tax year is $130,000 or more and less than
$135,000, or, if reported on a joint return, $260,000 or more and
less than $270,000.
(D) $2,200, if the federal adjusted gross income of the
taxpayer for the tax year is $135,000 or more and less than
$140,000, or, if reported on a joint return, $270,000 or more and
less than $280,000.
(E) $1,100, if the federal adjusted gross income of the
taxpayer for the tax year is $140,000 or more and less than
$145,000, or, if reported on a joint return, $280,000 or more and
less than $290,000.
(c) If the federal adjusted gross income of the taxpayer is
$145,000 or more for the tax year, or, if reported on a joint
return, $290,000 or more, the limit is zero and the taxpayer is
not allowed a subtraction for federal income taxes under ORS
316.680 (1) for the tax year.
(d) In the case of a husband and wife filing separate tax
returns, the amount added shall be in the amount of any federal
income taxes in excess of { + 50 percent of + } the amount
provided for individual taxpayers under paragraphs (a) to (c) of
this subsection, less the amount of any refund of federal taxes
previously accrued for which a tax benefit was received.
(e) For purposes of this subsection, the limits applicable to a
joint return shall apply to a head of household or a surviving
spouse, as defined in section 2(a) and (b) of the Internal
Revenue Code.
(f)(A) For a calendar year beginning on or after January 1,
2008, the Department of Revenue shall make a cost-of-living
adjustment to the federal income tax threshold amounts described
in paragraphs (b) and (d) of this subsection.
(B) The cost-of-living adjustment for a calendar year is the
percentage by which the monthly averaged U.S. City Average
Consumer Price Index for the 12 consecutive months ending August
31 of the prior calendar year exceeds the monthly averaged index
for the period beginning September 1, 2005, and ending August 31,
2006.
(C) As used in this paragraph, 'U.S. City Average Consumer
Price Index' means the U.S. City Average Consumer Price Index for
All Urban Consumers (All Items) as published by the Bureau of
Labor Statistics of the United States Department of Labor.
(D) If any adjustment determined under subparagraph (B) of this
paragraph is not a multiple of $50, the adjustment shall be
rounded to the next lower multiple of $50.
(E) The adjustment shall apply to all tax years beginning in
the calendar year for which the adjustment is made.
(4)(a) In addition to the adjustments required by ORS 316.130,
a full-year nonresident individual shall add to taxable income a
proportion of any accrued federal income taxes as computed under
ORS 316.685 in excess of the amount provided in subsection (3) of
this section in the proportion provided in ORS 316.117.
(b) In the case of a husband and wife filing separate tax
returns, the amount added under this subsection shall be computed
in a manner consistent with the computation of the amount to be
added in the case of a husband and wife filing separate returns
under subsection (3) of this section. The method of computation
shall be determined by the Department of Revenue by rule.
(5) Subsections (3)(d) and (4)(b) of this section shall not
apply to married individuals living apart as defined in section
7703(b) of the Internal Revenue Code.
(6)(a) For tax years beginning on or after January 1, 1981, and
prior to January 1, 1983, income or loss taken into account in
determining federal taxable income by a shareholder of an S
corporation pursuant to sections 1373 to 1375 of the Internal
Revenue Code shall be adjusted for purposes of determining Oregon
taxable income, to the extent that as income or loss of the S
corporation, they were required to be adjusted under the
provisions of ORS chapter 317.
(b) For tax years beginning on or after January 1, 1983, items
of income, loss or deduction taken into account in determining
federal taxable income by a shareholder of an S corporation
pursuant to sections 1366 to 1368 of the Internal Revenue Code
shall be adjusted for purposes of determining Oregon taxable
income, to the extent that as items of income, loss or deduction
of the shareholder the items are required to be adjusted under
the provisions of this chapter.
(c) The tax years referred to in paragraphs (a) and (b) of this
subsection are those of the S corporation.
(d) As used in paragraph (a) of this subsection, an S
corporation refers to an electing small business corporation.
(7)(a) The taxpayer shall be entitled to an additional amount,
as referred to in subsection (1)(c)(A) and (D) of this section,
of $1,000:
(A) For the taxpayer if the taxpayer has attained age 65 before
the close of the taxpayer's { - taxable - } { + tax + } year;
and
(B) For the spouse of the taxpayer if the spouse has attained
age 65 before the close of the { - taxable - } { + tax + }
year and an additional exemption is allowable to the taxpayer for
such spouse for federal income tax purposes under section 151(b)
of the Internal Revenue Code.
(b) The taxpayer shall be entitled to an additional amount, as
referred to in subsection (1)(c)(A) and (D) of this section, of
$1,000:
(A) For the taxpayer if the taxpayer is blind at the close of
the { - taxable - } { + tax + } year; and
(B) For the spouse of the taxpayer if the spouse is blind as of
the close of the { - taxable - } { + tax + } year and an
additional exemption is allowable to the taxpayer for such spouse
for federal income tax purposes under section 151(b) of the
Internal Revenue Code. For purposes of this subparagraph, if the
spouse dies during the
{ - taxable - } { + tax + } year, the determination of
whether such spouse is blind shall be made immediately prior to
death.
(c) In the case of an individual who is not married and is not
a surviving spouse, paragraphs (a) and (b) of this subsection
shall be applied by substituting '$1,200' for '$1,000. '
(d) For purposes of this subsection, an individual is blind
only if the individual's central visual acuity does not exceed
20/200 in the better eye with correcting lenses, or if the
individual's visual acuity is greater than 20/200 but is
accompanied by a limitation in the fields of vision such that the
widest diameter of the visual field subtends an angle no greater
than 20 degrees.
(8) In the case of an individual with respect to whom a
deduction under section 151 of the Internal Revenue Code is
allowable for federal income tax purposes to another taxpayer for
a { - taxable - } { + tax + } year beginning in the calendar
year in which the individual's { - taxable - } { + tax + }
year begins, the basic standard deduction (referred to in
subsection (1)(c)(B) of this section) applicable to such
individual for such individual's { - taxable - } { + tax + }
year shall equal the lesser of:
(a) The amount allowed to the individual under section 63(c)(5)
of the Internal Revenue Code for federal income tax purposes for
the tax year for which the deduction is being claimed; or
(b) The amount determined under subsection (1)(c)(B) of this
section.
SECTION 4. ORS 317.061, as amended by section 9, chapter 745,
Oregon Laws 2009, is amended to read:
317.061. The rate of the tax imposed by and computed under this
chapter is:
(1) Six and six-tenths percent of the first { - $10
million - } { + $2.5 million + } of taxable income, or fraction
thereof; and
(2) Seven and six-tenths percent of any amount of taxable
income in excess of { - $10 million - } { + $2.5 million + }.
SECTION 5. ORS 316.085 is amended to read:
316.085. (1)(a) There shall be allowed a personal exemption
credit against taxes otherwise due under this chapter. The credit
shall equal $90 multiplied by the number of personal exemptions
allowed under section 151 of the Internal Revenue Code.
(b) In the case of an individual with respect to whom a credit
under paragraph (a) of this subsection is allowable to another
taxpayer for a taxable year beginning in the calendar year in
which the individual's taxable year begins, the credit amount
applicable to such individual for such individual's taxable year
is zero.
(2)(a) A nonresident shall be allowed the credit provided under
subsection (1) of this section computed in the same manner and
subject to the same limitations as the credit allowed to a
resident of this state. However, the credit shall be prorated
using the proportion provided in ORS 316.117.
(b) If a change in the taxable year of a taxpayer occurs as
described in ORS 314.085, or if the Department of Revenue
terminates the taxpayer's taxable year under ORS 314.440, the
credit allowed by this section shall be prorated or computed in a
manner consistent with ORS 314.085.
(c) If a change in the status of a taxpayer from resident to
nonresident or from nonresident to resident occurs, the credit
allowed by this section shall be determined in a manner
consistent with ORS 316.117.
(3) The Department of Revenue shall recompute the dollar amount
of the personal exemption credit allowed for state personal
income tax purposes. The computation shall be as follows:
(a) Divide the monthly averaged U.S. City Average Consumer
Price Index for the 12 consecutive months ending August 31 of the
prior calendar year by the monthly averaged index for the first
six months of 1986.
(b) Recompute the dollar amount of the personal exemption
credit by multiplying $90 by the appropriate indexing factor
determined as provided in paragraph (a) of this subsection. Round
off the amount obtained under this paragraph to the nearest $1.
{ + (4) Notwithstanding subsections (1) to (3) of this
section, the maximum amount allowed as an exemption credit under
this section may not exceed the amount calculated under
subsection (1) of this section reduced by:
(a) 20 percent, if the federal adjusted gross income of the
taxpayer for the tax year is $100,000 or more and less than
$106,250.
(b) 40 percent, if the federal adjusted gross income of the
taxpayer for the tax year is $106,250 or more and less than
$112,500.
(c) 60 percent, if the federal adjusted gross income of the
taxpayer for the tax year is $112,500 or more and less than
$118,750.
(d) 80 percent, if the federal adjusted gross income of the
taxpayer for the tax year is $118,750 or more and less than
$125,000.
(5) For purposes of subsections (3) and (4) of this section,
the amounts of the federal adjusted gross income of the taxpayer
are doubled for a taxpayer who files a return jointly, as a head
of household or as a surviving spouse.
(6) A taxpayer may not claim the exemption credit otherwise
allowed under this section if the federal adjusted gross income
of the taxpayer exceeds $250,000, for joint return filers, a
surviving spouse or a head of household, or $125,000, for all
other taxpayers. + }
{ - (4) - } { + (7) + } As used in this section, 'U.S. City
Average Consumer Price Index' means the U.S. City Average
Consumer Price Index for All Urban Consumers (All Items) as
published by the Bureau of Labor Statistics of the United States
Department of Labor.
{ - (5) Notwithstanding subsections (1) to (3) of this
section, if a taxpayer's federal adjusted gross income for the
tax year exceeds the threshold amount, the exemption amount shall
be the greater of: - }
{ - (a) Thirty-three percent of the amount computed in
subsection (3) of this section; or - }
{ - (b) The amount computed in subsection (3) of this section
reduced by: - }
{ - (A) Two percentage points for each $2,500 (or fraction
thereof) by which the taxpayer's federal adjusted gross income
exceeds the threshold amount; or - }
{ - (B) Two percentage points for each $1,250 (or fraction
thereof) by which the taxpayer's federal adjusted gross income
exceeds the threshold amount, if the taxpayer is married but
filing separately. - }
{ - (6) As used in this section, 'threshold amount'
means: - }
{ - (a) $234,600 in the case of a joint return or a surviving
spouse. - }
{ - (b) $195,500 in the case of a head of a household. - }
{ - (c) $156,400 in the case of an individual who is not a
married individual and is not a surviving spouse. - }
{ - (d) $117,300 in the case of a married individual filing a
separate return. - }
{ - (7) The Department of Revenue shall adjust the threshold
amounts in subsection (6) of this section according to the
cost-of-living adjustment for the calendar year. The department
shall annually recompute the threshold amounts for the current
tax year by multiplying each dollar amount by the percentage (if
any) by which the monthly averaged U.S. City Average Consumer
Price Index for the 12 consecutive months ending August 31 of the
prior calendar year exceeds the monthly averaged U.S. City
Average Consumer Price Index for the 12 consecutive months ending
August 31, 2006. - }
{ - (8) If a threshold amount computed under subsections (6)
and (7) of this section is not a multiple of $50, the amount
shall be rounded to the next lower multiple of $50. - }
SECTION 5a. ORS 315.266 is amended to read:
315.266. (1) In addition to any other credit available for
purposes of ORS chapter 316, an eligible resident individual
shall be allowed a credit against the tax otherwise due under ORS
chapter 316 for the tax year in an amount equal to { - six - }
{ + eight + } percent of the earned income credit allowable to
the individual for the same tax year under section 32 of the
Internal Revenue Code.
(2) An eligible nonresident individual shall be allowed the
credit computed in the same manner and subject to the same
limitations as the credit allowed a resident by subsection (1) of
this section. However, the credit shall be prorated using the
proportion provided in ORS 316.117.
(3) If a change in the taxable year of a taxpayer occurs as
described in ORS 314.085, or if the Department of Revenue
terminates the taxpayer's taxable year under ORS 314.440, the
credit allowed by this section shall be prorated or computed in a
manner consistent with ORS 314.085.
(4) If a change in the status of a taxpayer from resident to
nonresident or from nonresident to resident occurs, the credit
allowed by this section shall be determined in a manner
consistent with ORS 316.117.
(5) If the amount allowable as a credit under this section,
when added to the sum of the amounts allowable as payment of tax
under ORS 316.187 or 316.583, other tax prepayment amounts and
other refundable credit amounts, exceeds the taxes imposed by ORS
chapters 314 and 316 for the tax year after application of any
nonrefundable credits allowable for purposes of ORS chapter 316
for the tax year, the amount of the excess shall be refunded to
the taxpayer as provided in ORS 316.502.
(6) The Department of Revenue may adopt rules for purposes of
this section, including but not limited to rules relating to
proof of eligibility and the furnishing of information regarding
the federal earned income credit claimed by the taxpayer for the
tax year.
(7) Refunds attributable to the earned income credit allowed
under this section shall not bear interest.
SECTION 6. { + (1) Section 2 of this 2013 Act and the
amendments to ORS 316.085, 316.695 and 317.061 by sections 3 to 5
of this 2013 Act apply to tax years beginning on or after January
1, 2013.
(2) The amendments to ORS 315.266 by section 5a of this 2013
Act apply to tax years beginning on or after January 1, 2013, and
before January 1, 2014. + }
SECTION 7. ORS 323.030 is amended to read:
323.030. (1) Every distributor shall pay a tax upon
distributions of cigarettes at the rate of 29 mills for the
distribution of each cigarette in this state.
(2) The taxes imposed by ORS 323.005 to 323.482 are in lieu of
all other state, county or municipal taxes on the sale or use of
cigarettes.
(3) Any cigarette with respect to which a tax has been prepaid
under ORS 323.068 or has otherwise once been imposed under ORS
323.005 to 323.482 is not subject upon a subsequent distribution
to the taxes imposed by ORS 323.005 to 323.482.
{ + (4) In addition to and not in lieu of any other tax
imposed under ORS 323.005 to 323.482, every distributor shall pay
a tax upon distributions of cigarettes at the rate of five mills
for the distribution of each cigarette in this state. + }
SECTION 8. ORS 323.505 is amended to read:
323.505. (1) A tax is hereby imposed upon the distribution of
all tobacco products in this state. The tax imposed by this
section is intended to be a direct tax on the consumer, for which
payment upon distribution is required to achieve convenience and
facility in the collection and administration of the tax. The tax
shall be imposed on a distributor at the time the distributor
distributes tobacco products.
(2) The tax imposed under this section shall be imposed at the
rate of:
(a) { - Sixty-five - } { + 70 + } percent of the wholesale
sales price of cigars, but not to exceed { - 50 - }
{ + 56 + } cents per cigar;
(b) One dollar and { - seventy-eight - } { + ninety-six + }
cents per ounce based on the net weight determined by the
manufacturer, in the case of moist snuff, except that the minimum
tax under this paragraph is { - $2.14 - } { + $2.35 + } per
retail container; or
(c) { - Sixty-five - } { + 70 + }percent of the wholesale
sales price of all tobacco products that are not cigars or moist
snuff.
(3) For reporting periods beginning on or after July 1, 2019,
the rates of tax applicable to moist snuff under subsection
(2)(b) of this section shall be adjusted for each biennium
according to the cost-of-living adjustment for the calendar year.
The Department of Revenue shall recompute the rates for each
biennium by adding to the rates in subsection (2)(b) of this
section the product obtained by multiplying the rates in
subsection (2)(b) of this section by a factor that is equal to
0.25 multiplied by the percentage (if any) by which the monthly
averaged U.S. City Average Consumer Price Index for the 12
consecutive months ending August 31 of the prior calendar year
exceeds the monthly averaged U.S. City Average Consumer Price
Index for the 12 consecutive months ending August 31, 2017.
(4) If the tax imposed under this section does not equal an
amount calculable to a whole cent, the tax shall be equal to the
next higher whole cent. However, the amount remitted to the
Department of Revenue by the taxpayer for each quarter shall be
equal only to 98.5 percent of the total taxes due and payable by
the taxpayer for the quarter.
(5) No tobacco product shall be subject to the tax if the base
product or other intermediate form thereof has previously been
taxed under this section.
SECTION 9. ORS 323.455 is amended to read:
323.455. (1) All moneys received by the Department of Revenue
from the tax imposed by ORS 323.030 (1) shall be paid over to the
State Treasurer to be held in a suspense account established
under ORS 293.445. The department may pay expenses for
administration of ORS 323.005 to 323.482 out of moneys received
from the tax imposed under ORS 323.030 (1). Amounts necessary to
pay administrative expenses are continuously appropriated to the
department from the suspense account. After the payment of
administrative expenses and refunds, 89.65 percent shall be
credited to the General Fund, 3.45 percent is appropriated to the
cities of this state, 3.45 percent is appropriated to the
counties of this state and 3.45 percent is continuously
appropriated to the Department of Transportation for the purpose
of financing and improving transportation services for elderly
individuals and individuals with disabilities as provided in ORS
391.800 to 391.830.
(2) The moneys { - so - } appropriated to cities and
counties { + under subsection (1) of this section + } shall be
paid on a monthly basis within 35 days after the end of the month
for which a distribution is made. Each city shall receive such
share of the money appropriated to all cities as its population,
as determined under ORS 190.510 to 190.590 last preceding such
apportionment, bears to the total population of the cities of the
state, and each county shall receive such share of the money as
its population, determined under ORS 190.510 to 190.590 last
preceding such apportionment, bears to the total population of
the state.
(3) The moneys appropriated to the Department of Transportation
under subsection (1) of this section shall be distributed and
transferred to the Elderly and Disabled Special Transportation
Fund established by ORS 391.800 at the same time as the cigarette
tax moneys are distributed to cities and counties under this
section.
(4) Of the moneys credited to the General Fund under
{ - this - } { + subsection (1) of this + } section { + , + }
51.92 percent shall be dedicated to funding the maintenance and
expansion of the number of persons eligible for the medical
assistance program under ORS chapter 414, or to funding the
maintenance of the benefits available under the program, or both,
and 5.77 percent shall be credited to the Tobacco Use Reduction
Account established under ORS 431.832.
{ + (5) All moneys received by the Department of Revenue from
the tax imposed by ORS 323.030 (4) shall be paid over to the
State Treasury to be held in a suspense account established under
ORS 293.445. After the payment of refunds, the balance shall be
credited to the Oregon Health Authority Fund established by ORS
413.101, for providing the services described in ORS 430.630. + }
SECTION 10. ORS 323.625 is amended to read:
323.625. All moneys received by the Department of Revenue under
ORS 323.500 to 323.645 shall be deposited in the State Treasury
and credited to a suspense account established under ORS 293.445.
The department may pay expenses for administration of ORS 323.500
to 323.645 out of moneys received from the taxes imposed under
ORS 323.505 and 323.565. Amounts necessary to pay administrative
expenses are continuously appropriated to the department from the
suspense account. After the payment of administrative expenses
and refunds or credits arising from erroneous overpayments, the
balance of the money shall be credited to the General Fund. Of
the amount credited to the General Fund under this
section { + , + } { - 41.54 - } { + 37.29 + } percent shall
be dedicated to funding the maintenance and expansion of the
number of persons eligible for the medical assistance program
under ORS chapter 414, or to funding the maintenance of the
benefits available under the program, or both, and 4.62 percent
shall be credited to the Tobacco Use Reduction Account
established under ORS 431.832.
SECTION 11. { + (1) The amendments to ORS 323.030 and 323.455
by sections 7 and 9 of this 2013 Act apply to distributions of
cigarettes occurring on or after January 1, 2014.
(2) The amendments to ORS 323.505 and 323.625 by sections 8 and
10 of this 2013 Act apply to distributions of tobacco products
occurring on or after January 1, 2014. + }
SECTION 12. { + (1) In addition to and not in lieu of any
other tax, for the privilege of holding or storing cigarettes for
sale, use or consumption, a floor tax is imposed upon every
dealer at the rate of five mills for each cigarette in the
possession of or under the control of the dealer in this state at
12:01 a.m. on January 1, 2014.
(2) The tax imposed by this section is due and payable on or
before January 20, 2014. Any amount of tax that is not paid
within the time required shall bear interest at the rate
established under ORS 305.220 per month, or fraction of a month,
from the date on which the tax is due to be paid, until paid.
(3) On or before January 20, 2014, every dealer must file a
report with the Department of Revenue in such form as the
department may prescribe. The report must state the number of
cigarettes in the possession of or under the control of the
dealer in this state at 12:01 a.m. on January 1, 2014, and the
amount of tax due. Each report must be accompanied by a
remittance payable to the department for the amount of tax
due. + }
SECTION 13. { + In addition to and not in lieu of any other
tax, for the privilege of distributing cigarettes as a
distributor and for holding or storing cigarettes for sale, use
or consumption, a floor tax and cigarette adjustment indicia tax
is imposed upon every distributor in the amount of 12.5 cents for
each Oregon cigarette tax stamp bearing the designation '25,' in
the amount of 10 cents for each Oregon cigarette tax stamp
bearing the designation '20' and in the amount of five cents for
each Oregon cigarette tax stamp bearing the designation '10,'
that is affixed to any package of cigarettes in the possession of
or under the control of the distributor at 12:01 a.m. on January
1, 2014. + }
SECTION 14. { + (1) Every distributor must take an inventory
as of 12:01 a.m. on January 1, 2014, of all packages of
cigarettes to which are affixed Oregon cigarette tax stamps and
of all unaffixed Oregon cigarette tax stamps in the possession of
or under the control of the distributor.
(2) Every distributor must file a report with the Department of
Revenue on or before January 20, 2014, in such form as the
department may prescribe, showing:
(a) The number of Oregon cigarette tax stamps, with the
designations of the stamps, that were affixed to packages of
cigarettes in the possession of or under the control of the
distributor at 12:01 a.m. on January 1, 2014; and
(b) The number of unaffixed Oregon cigarette tax stamps, with
the designations of the stamps, that were in the possession of or
under the control of the distributor at 12:01 a.m. on January 1,
2014.
(3) The amount of tax required to be paid with respect to the
affixed Oregon cigarette tax stamps shall be computed pursuant to
section 13 of this 2013 Act and remitted with the distributor's
report. Any amount of tax not paid within the time specified for
the filing of the report shall bear interest at the rate
established under ORS 305.220 per month, or fraction of a month,
from the due date of the report until paid. + }
SECTION 15. ORS 317.853 is amended to read:
317.853. (1) For tax years beginning on or after January 1,
2013, { + and before January 1, 2017, + } any revenue that is
received as a result of a rate of tax above { - six and
six-tenths - } { + 7.6 + } percent imposed under this chapter
and that is in excess of the revenue that would be received under
this chapter at a rate of { - six and six-tenths - } { +
7.6 + } percent shall be deposited into the Oregon Rainy Day Fund
established by ORS 293.144.
{ + (2) For tax years beginning on or after January 1, 2017,
any revenue that is received as a result of a rate of tax above
7.15 percent imposed under this chapter and that is in excess of
the revenue that would be received under this chapter at a rate
of 7.15 percent shall be deposited into the Oregon Rainy Day Fund
established by ORS 293.144. + }
{ - (2) - } { + (3) + } Before the end of each biennium,
beginning with the biennium ending on June 30, 2015, the
Department of Revenue shall estimate the revenue described in
{ - subsection (1) - } { + subsections (1) and (2) + } of this
section that is received during the biennium. An amount equal to
that estimate shall be transferred into the Oregon Rainy Day Fund
established by ORS 293.144 on or before June 30 of each
odd-numbered year.
SECTION 16. ORS 318.074 is amended to read:
318.074. (1) For tax years beginning on or after January 1,
2013, { + and before January 1, 2017, + } any revenue that is
received as a result of a rate of tax above { - six and
six-tenths - } { + 7.6 + } percent imposed under this chapter
and that is in excess of the revenue that would be received under
this chapter at a rate of { - six and six-tenths - } { +
7.6 + } percent shall be deposited into the Oregon Rainy Day Fund
established by ORS 293.144.
{ + (2) For tax years beginning on or after January 1, 2017,
any revenue that is received as a result of a rate of tax above
7.15 percent imposed under this chapter and that is in excess of
the revenue that would be received under this chapter at a rate
of 7.15 percent shall be deposited into the Oregon Rainy Day Fund
established by ORS 293.144. + }
{ - (2) - } { + (3) + } Before the end of each biennium,
beginning with the biennium ending on June 30, 2015, the
Department of Revenue shall estimate the revenue described in
{ - subsection (1) - } { + subsections (1) and (2) + } of this
section that is received during the biennium. An amount equal to
that estimate shall be transferred into the Oregon Rainy Day Fund
established by ORS 293.144 on or before June 30 of each
odd-numbered year.
SECTION 17. { + This 2013 Act takes effect on the 91st day
after the date on which the 2013 regular session of the
Seventy-seventh Legislative Assembly adjourns sine die. + }
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