Find answers to common questions regarding Measure 26-201 that taxes Portland sales.
What is a "gross receipts" tax?
A gross receipts tax is a tax on a company’s gross sales – not on its profits. Because it functions like any other operating expense, companies must factor into the price of a good or service, it means the added expense will simply be passed on to the consumers in the form of higher prices.
What is the measure for a gross receipts tax?
How does Measure 26-201 define "retail sales?"
Uniquely. The common understanding of a retail sale is the sale of a good to an end user. Measure 26-201 expands that traditional understanding of retail sales to include most services. “Retail sale includes but is not limited to the sale of services, including but not limited to retail banking services.” [Measure 26-201, Section 3 (16)]
That means everyday essentials such as cell phone service, internet access, transportation, and insurance will cost more, not just toothpaste, gas for your car and flooring from a big box hardware store. The tax explicitly applies to banking services, something not found in any other definition of retail sales. So, the Measure 26-201 will also increase the cost of banking.
Measure 26-201 will add costs for all business, not just big “retailers” directly subject to the tax. Small businesses will get hit two ways – through the purchase of goods, such as office supplies, and though service they require, such as phone services, internet, insurance and, of course, banking.
How much money is Measure 26-201 expected to raise?
The City of Portland conducted a revenue estimate on a similar – but narrower – version of this initiative and found it could raise as much as $51 million. This new version’s inclusion of business-to-business transactions, however, will cost Portland much more, raising up to $79 million annually.
Aren't Portlanders already paying to fight climate change?
Yes. Portland businesses and households already pay 6% on their electricity bills and 3% on their natural gas bills to fund renewable energy and energy efficiency projects. Combined, PGE and Pacific Power customers pay $180 million per year through this fee to spend on climate-related projects in their service territories throughout the state. The proposed new tax amounts to a double tax to fund the same effort.