Central City Task Force finds Portland has second-highest top marginal tax rate in U.S.
PORTLAND, Ore. (KOIN) — A new report shows how Portland tax measures have impacted residents and business owners, causing some of the area’s higher-income households to relocate elsewhere.
The Portland Central City Task Force’s Tax Advisory Group released a report titled “Nineteen Facts About Economic, Fiscal, and Service Conditions in Portland, Oregon” this month.
The group found that local lawmakers and voters have approved at least 20 major tax measures since 2009. That year, the Oregon legislature added two new income tax brackets for those earning more than $125,000 and $250,000 in a year. More recent additions include property taxes that funded Portland Parks & Recreation and the Multnomah County Library, with both taking effect in 2021.
According to the report, the burden of state and local taxes “is high for all but the lowest income households.” Data show Portland households earning up to $25,000 are taxed by 10%, which is less than other major western cities like Seattle, Phoenix and Boise.
For those earning between $50,000 and $150,000, the percentage ranges from 9.9% to 11.1%. The Tax Advisory Group noted this rate is only exceeded by Los Angeles and other California cities.
When compared to other cities nationwide, Portland has the second-highest marginal income tax rate for top earners — only behind New York City. Single-person households earning more than $250,000 see a state and local marginal tax rate of 13.9%. NYC’s top rate sits at 14.8%, although that applies to households earning more than $250 million.
The task force additionally reported financial changes for Portland businesses, with their paid taxes surging by 82% from more than $781 million in 2019 to more than $1.4 billion in 2023.
“The findings should not come as a surprise to those who closely follow local budget and fiscal matters,” the Tax Advisory Group wrote in the report. “The City and County are emerging from a period that included a global pandemic, the largest federal stimulus program in U.S. history, and sizable, voter-approved expansions in taxes and services.”
The group attributed these tax measures, namely 2020’s Supportive Housing Services and Preschool for All, to the increase in high-earners leaving the metro area. According to numbers from the Internal Revenue Service, the average income of those relocating from Multnomah County grew from the mid-to-low $70,000s in 2019 to more than $100,000 in 2022.
The report also listed the city and county’s homeless population, police response times and prosecutor caseloads as other financial woes.