FAQs on OPR

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How do we calculate the “about $750” for every Oregonian?

The revenue for the Oregon People’s Rebate comes from modestly increasing of the minimum tax huge corporations (those with over $25 million in sales) pay to a new minimum of 3% (currently, these huge corporations pay a minimum tax of less than 1/8 of 1%, or 0.12%).

The math behind the Oregon People’s Rebate is this:

  • The Oregon People’s Rebate is expected to raise at least $3 billion per year
  • There are about 4 million people in Oregon (4,093,465)
  • Rebating (dividing) $3 billion to (by) 4 million Oregonians is about $750 for every Oregonian


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My business already pays 3% or more in Oregon taxes, what will change?

Nothing.

The Oregon People’s Rebate sets the minimum tax for huge corporations at 3%. Huge corporations are those that make more than $68,493 of sales in our state every single day (over $25 million per year). If your business is already paying 3% or more, your taxes won’t change.

Oh, and each of your customers will have about an extra $750 to spend, maybe in your business.


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How will a small business benefit from the Oregon People’s Rebate?

Small businesses will benefit from the Oregon People’s Rebate because every one of their customers will have about $750 more to send every year, and any business with less than $25 million in yearly sales (over $68,493 per day!) will not have to pay any more than they do today. Overall, the Oregon People’s Rebate will be a huge economic stimulus to our communities.


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Will receiving the rebate negatively affect Oregonian’s income-based benefits?

No. The Oregon People’s Rebate is not considered income for Oregon tax purposes, it is essentially like expanding and increasing the popular Earned Income Tax Credit (EITC). Also, just in case, the proposed language states that any reduction in federal income-based benefits is offset through a “Hold Harmless” program.


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Will huge corporations pass on the new higher minimum 3% tax to consumers?

The fact that the largest corporations pay less (or zero) taxes in Oregon doesn’t mean that our prices are lower, it just means that for every dollar they sell these large corporations make more money in Oregon than in other states!

Also,

  • Large corporations set their prices nationally (or at least regionally).
    • For example, the basic cable teaser rate is $19.99 just about everywhere in the U.S., regardless of state taxes. Same for overdraft fees, electronics, food, etc.
  • Previous worst-case scenario research on similar initiatives suggests a possible increase of about $600 more per family per year. The Oregon People’s Rebate is estimated to be $2,250 for the average Oregon household. Any way you slice it, Oregonians will be ahead with the Oregon People’s Rebate.

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Will corporations leave Oregon because of the Oregon People’s Rebate?

Since customers cannot be outsourced, we doubt huge corporations will refuse to do business in Oregon. If some of them leave, smaller corporations and “Mom and Pop” shops will step in.


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Does any of the revenue from the Oregon People’s Rebate go to the General Fund?

All of the revenue from the Oregon People’s Rebate is rebated directly to Oregonians. 

Oregonians can choose to decline the Oregon People’s Rebate and those rebates, as well as any unclaimed rebates, are used to provide additional funding for public early childhood and kindergarten through twelfth grade education, healthcare, and services for senior citizens.


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Is the Oregon People’s Rebate like the Alaska Permanent Fund Dividend (APFC)?

Yes and no.

We studied the Alaska Permanent Fund Dividend (APFC) when drafting the Oregon People’s Rebate so there are some similarities and important differences.

For example:

  • How much is each?
    • Alaska Permanent Fund Dividend: Average abut $1,350 over the last 10 years
    • Oregon People’s Rebate: About $750
  • What are the residency requirements?
    • Alaska Permanent Fund Dividend: 365 days in the calendar year
    • Oregon People’s Rebate: 200+ days in the calendar year
  • Where does the money come from?
    • Alaska Permanent Fund Dividend: Oil extraction taxes are invested and a portion of the dividends from those investments are paid out.
    • Oregon People’s Rebate: Of the money that Oregonians give huge corporations after $25 million, 3% of it is returned (rebated).
  • Is the source of the money sustainable?
    • Alaska Permanent Fund Dividend: No, because the AFPD is based on oil extraction. But, the people who designed the APFD knew that and they designed the APFD so that when the oil runs out the fund will continue to accrue interest, and that could be paid out.
    • Oregon People’s Rebate: Yes, the Oregon People’s Rebate is funded by the things we buy every day from huge corporations.
  • Will people become lazy or flock to the state?
    • Alaska Permanent Fund Dividend: No, neither of these has happened.
    • Oregon People’s Rebate: There is no reason to believe that this will happen in Oregon either. The fact that the Oregon People’s Rebate is estimated to be less than the Alaska Permanent Fund Dividend supports this.


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