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83rd OREGON LEGISLATIVE ASSEMBLY--2025 Regular Session
Senate Bill 573
Sponsored by Senator FREDERICK (Presession filed.)
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 as introduced.The statement includes a measure digest written in compliance with applicable readability
standards.
Digest: The measure would repeal the statutes that make up the provision known as the per-
sonal income tax kicker. (Flesch Readability Score: 62.8).
Discontinues the return of surplus revenue refunds to taxpayers. Modifies statutory provisions.
Applies to biennia ending on or after June 30, 2027.
Takes effect only if Senate Joint Resolution 15 (2025) is approved by the people at the next
regular general election. Takes effect on the effective date of the constitutional amendment proposed
in Senate Joint Resolution 15 (2025).
A BILL FOR AN ACT
Relating to surplus revenue disposition; creating new provisions; amending ORS 291.349; repealing
ORS 291.351, 305.792 and 305.794; and prescribing an effective date.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 291.349 is amended to read:
291.349. (1) As soon as practicable after adjournment sine die of the odd-numbered year regular
session of the Legislative Assembly, the Oregon Department of Administrative Services shall report
to the Legislative Revenue Officer and the Legislative Fiscal Officer the estimate as of July 1 of the
first year of the biennium of General Fund and State Lottery Fund revenues that will be received
by the state during that biennium. The Oregon Department of Administrative Services shall base its
estimate on the last forecast given to the Legislative Assembly before adjournment sine die of the
odd-numbered year regular session on which the printed, adopted budget prepared in the Oregon
Department of Administrative Services is based, adjusted only insofar as necessary to reflect
changes in laws adopted at that session. The report shall contain the estimated revenues from cor-
porate income and excise taxes separately from the estimated revenues from other General Fund
sources. The Oregon Department of Administrative Services may revise the estimate if necessary
following adjournment sine die of a special session or an even-numbered year regular session of the
Legislative Assembly, but any revision does not affect the basis of the computation described in
subsection (3) [or (4)] of this section.
(2) As soon as practicable after the end of the biennium, the Oregon Department of Adminis-
trative Services shall report to the Legislative Revenue Officer and the Legislative Fiscal Officer,
or the Legislative Assembly if it is in session, the amount of General Fund revenues collected as
of the last June 30 of the preceding biennium. The report shall contain the collections from corpo-
rate income and excise taxes separately from collections from other sources.
(3) If the revenues received from the corporate income and excise taxes during the biennium
exceed the amounts estimated to be received from such taxes for the biennium, as estimated after
adjournment sine die of the odd-numbered year regular session, by two percent or more, the total
amount of that excess shall be retained in the General Fund and used, in the manner described in
NOTE:Matter in boldfaced type in an amended section is new; matter [italic and bracketed] is existing law to be omitted.
New sections are in boldfaced type.
LC 1176 SB573
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ORS 291.345, to provide additional funding for public education, kindergarten through grade 12.
[(4) If the revenues received from General Fund revenue sources, exclusive of those described in
subsection (3) of this section, during the biennium exceed the amounts estimated to be received from
such sources for the biennium, as estimated after adjournment sine die of the odd-numbered year reg-
ular session, by two percent or more, there shall be credited to personal income taxpayers an amount
equal to the total amount of that excess, reduced by the cost certified by the Department of Revenue
under ORS 291.351 as being allocable to credits described under this subsection. The excess amount
to be credited shall be credited to personal income taxpayers in a percentage amount of prior year
personal income tax liability as determined under subsection (5) of this section.]
[(5)(a) If there is an excess to be credited under subsection (4) of this section, on or before No-
vember 1, following the end of each biennium, the Oregon Department of Administrative Services shall
determine and certify to the Department of Revenue the percentage amounts of credit for purposes of
subsection (4) of this section. The percentage amounts determined shall be percentage amounts to the
nearest one-tenth of a percentthatwilldistributetheexcesstobecreditedtopersonalincome
taxpayers.]
[(b) The percentage amount applicable to subsection (4) of this section shall equal the amount dis-
tributed under subsection (4) of this section divided by the estimated total personal income tax liability
for all personal income taxpayers for tax years beginning in the calendar year immediately preceding
the calendar year in which the excess is determined.]
[(c) The amount of the surplus credit under subsection (4) of this section is determined by multi-
plying the percentage amount determined under paragraph (b) of this subsection by the total amount
of a personal income taxpayer’s tax liability for the tax year beginning in the calendar year imme-
diately preceding the calendar year in which the excess is determined in order to calculate the amount
to be credited to the taxpayer.]
[(d) The credit shall be determined based on the tax liability as shown on the return of the taxpayer
or as corrected by the Department of Revenue.]
[(e) The credit shall be computed after the allowance of a credit provided under ORS 316.082,
316.131 or 316.292, but before the allowance of any other credit or offset against tax liability allowed
or allowable under any provision of law of this state, and before the application of estimated tax pay-
ments, withholding or other advance tax payments.]
[(f) For personal income taxpayers, if a credit applied against tax liability as described in para-
graph (e) of this subsection reduces tax liability to zero and an amount of the credit remains unused,
the remaining unused amount shall be refunded to the taxpayer. For purposes of ORS chapters 305,
314, 315 and 316, refunds issued under this paragraph are refunds of an overpayment of tax imposed
under ORS chapter 316.]
[(g) The Department of Revenue may prescribe by rule the manner of calculating and claiming a
credit if the filing status of a taxpayer changes between the tax year for which a credit may be claimed
and the succeeding tax year.]
[(6) A refund may not be made under this section to a taxpayer if the amount of the refund is less
than $1.]
[(7) Not later than November 15 following the end of the biennium, the Department of Revenue
shall provide information and guidance to taxpayers relating to the calculation of the credit.The de-
partment may make the information and guidance available electronically or otherwise.]
[(8) The Department of Revenue may adopt rules specifying the manner for issuing refunds under
this section to taxpayers who filed returns for the tax year on which the credit is computed but who
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are not required to file returns for the year in which the credit could be claimed.]
SECTION 2. ORS 291.351, 305.792 and 305.794 are repealed.
SECTION 3.The amendments to ORS 291.349 by section 1 of this 2025 Act and the repeal
of ORS 291.351, 305.792 and 305.794 by section 2 of this 2025 Act apply to biennia ending on
or after June 30, 2027.
SECTION 4. This 2025 Act does not take effect unless the amendment to the Oregon
Constitution proposed by Senate Joint Resolution 15 (2025) is approved by the people at the
next regular general election held in November 2026. This 2025 Act takes effect on the ef-
fective date of that constitutional amendment.
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