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Oregon and its cities and counties do not have a sales and use tax, but the state does have several other taxes, including a cigarette tax, alcohol tax, vehicle tax, and lodging tax. Certain industries and areas also have to pay taxes.
Types of taxes
Oregon does not have a sales and use tax on retail sales, but the state does tax certain tangible personal property and industries. Local jurisdictions do not have a local sales tax since the state sales tax does not exist.
Oregon has a forest products harvest tax (FPHT) that is levied on timber harvested from any land in Oregon, with the exception of most tribal lands. The first 25,000 board feet (25 MBF) are also exempt from the tax. Even if the harvest is less than 25 MBF (1,000 board feet), the property owner must file an FPHT return.
Taxable products include:
- Logs scaled as utility grade or greater.
- Logs sold by the ton.
- Loads of chips made from utility grade or better.
- Loads of chips for “hog fuel.”
The state mails FPHT returns in January if you notified the Department of Forestry that you were logging. The tax return is due by April 15 of the year after the harvest. Late returns have the following penalties:
- 5 percent for returns filed between April 16 and July 15.
- 25 percent for returns filed after July 15.
The tax rate is determined by MBF (thousand board feet). To determine MBF, divide the number of board feet harvested by 1,000. For example, 24,000 BF/1,000 equals 24 MBF. The tax rate is composed of several separate taxes as follows:
- 102.49 cents per 1,000 board feet for the Forest Research and Experiment Account and Forest Research Laboratory.
- 62.5 cents per 1,000 board feet for benefits related to fire suppression.
- 207.02 cents per 1,000 board feet for the Oregon Forest Practices Act.
- 10 cents per 1,000 board feet for the Oregon State University to make investments in professional forestry education at the College of Forestry.
If a property owner expects the tax to exceed $1,500 for the calendar year, it must make quarterly estimated tax payments as follows:
- 25 percent on or before April 30 for the first quarter of January through March.
- 25 percent on or before July 31 for the second quarter of April through June.
- 25 percent on or before October 31 for the third quarter of July through September.
- 25 percent on or before January 31 for the fourth quarter of October through December.
Oregon levies two taxes on vehicles sold or used in the state. The privilege tax is levied upon vehicle sellers in Oregon, and the vehicle use tax is levied on vehicles purchased from outside of the state that is required to be registered in the state.
The vehicle tax is one-half of 1 percent (0.005) on the retail price of any taxable vehicle.
Two Oregon vehicle taxes
Oregon levied two vehicle taxes beginning January 1, 2018:
- The vehicle privilege tax is a tax that Oregon levied for the privilege of selling vehicles in the state.
- The state applies the vehicle use tax to vehicles purchased from dealers outside of Oregon that are required to be registered and titled in Oregon.
One-half of 1 percent (.005) is due on the retail price of any taxable vehicle. A taxable vehicle is one that:
- Was purchased from a dealer or someone who would be required to register as a dealer.
- Had a purchase date of January 1, 2018 or later.
- Was driving 7,500 miles or less or sold with a manufacturer’s certificate of origin.
- Weighs 26,000 pounds or less.
- Has never been titled or registered in Oregon except as a demonstrator vehicle for a dealer.
The tax applies to:
- Commercial buses.
- Commercial motor vehicles.
- Fixed-load vehicles.
- Motor homes.
- Motor trucks.
- Tank vehicles.
- Trailers required to be registered in Oregon.
- Truck tractors.
- Worker transport buses.
- Passenger vehicles (cars, SUVs, pickup trucks, etc.).
Consumers who purchase vehicles out of state have 30 days to pay the use tax if the dealer does not collect the tax. If the dealer collects the tax, it will be listed as a separate line item as “Oregon Vehicle Use Tax.” If the consumer has to pay the tax, the Oregon Department of Motor Vehicles will email the consumer a certificate that contains an “L number.” The Oregon DMV will visually verify the L number.
If a consumer does not pay the tax on time, he will incur a 5-percent penalty. If the consumer does not file a return within 30 days of the purchase date, the penalty is 20 percent. The state charges interest on unpaid taxes; thus, it is best to pay the taxes earlier than the actual due dates.
- Leased vehicles: The lessor pays the tax when it purchases the vehicles to use as rentals or leases.
- Trailers and recreational vehicles: If a trailer has a manufacturer’s certificate of origin and is required to be registered, it is subject to the vehicle tax. The tax is also applicable to sales of travel trailers and fifth-wheels.
Lodging (Hotel room occupancy tax)
In 2003, Oregon established a lodging tax to generate funds for the Oregon Tourism Commission programs. The tax is 1.5 percent of the amount charged for the occupancy of transient lodging. Cities and counties may also levy an additional occupancy tax. Local returns are filed with the Oregon Department of Revenue.
The Department publishes a list of lodging taxes as charged by local jurisdictions; however, lodging establishments owners and managers should check with the local government to ensure they have the correct tax for the year, as these taxes could change.
Transient lodging includes:
- Bed and breakfast establishments.
- Camping spots, whether for RVs or tents.
- Guest ranches.
- Any other dwelling or portion of a dwelling used for temporary stays.
If an establishment did not collect any taxes for the year, it must still file a return. Returns are due on or before the last day of the month following the quarter. Thus, taxes collected from:
- January through March are due on or before the last day of April.
- April through June are due on or before the last day of July.
- July through September are due on or before the last day of October.
- October through December are due on or before the last day of January.
- Federal employees on federal business.
- Lodgers who stay 30 or more days at the same establishment.
Cigarette and tobacco excise taxes
Oregon levies taxes on cigarettes, cigars, and other tobacco products. In most cases, distributors pay the tax and put a stamp on the product. However, if a retailer wants to buy unstamped cigarettes, it must obtain a distributor’s license and pay the tax.
Only licensed distributors can purchase tax stamps. Distributors pay tax due quarterly. They must file a reconciliation report with the tax payment. Additionally, a distributor must file a reconciliation report (sales tax return) even if it did not have activity in the reporting period.
- Cigarettes: $3.33 per stamp for a pack of 20 cigarettes and little cigars.
- Cigars: 65 percent of the wholesale price, with a maximum of $1 per cigar.
- Moist snuff: $1.78 per ounce until June 30, 2022.
- Moist snuff: $1.80 per ounce on July 1, 2022.
- Other tobacco products, including vape products: 65 percent of the wholesale price.
Registering for and filing Oregon’s taxes
Locate the appropriate filing method, then follow the prompts. If you sign up for EFT payments, Oregon prefers that you continue sending payments via EFT, but you can still send a paper check.
Oregon sales tax holiday
Since Oregon does not have a sales tax, it does not have a sales tax holiday.
Oregon sales tax exemptions
Since Oregon does not collect sales taxes, it does not have sales tax exemptions.
Remote and marketplace sellers
Out-of-state business taxpayers should not collect retail sales tax from Oregon residents since the state does not have a sales and use tax. However, businesses in Oregon that sell to out-of-state residents must collect the other state’s sales and use tax in most cases.
Some states have thresholds to meet: $100,000 in gross receipts or 200 or more individual transactions for the state. However, most businesses collect sales tax without meeting the thresholds for the convenience of their customers.
If a business does not collect the other state’s tax and remit payment to the state, it should notify its customers that they have to pay a use tax to their state.
Oregon does not have a sales tax rate. The only tax liability is for certain sales of goods and tax liabilities.
You do not need a sales tax resale certificate since Oregon does not have a sales tax. However, if an out-of-state vendor requires a tax-exempt certificate, the state does have a form you can print and use from its tax forms page. Be sure to complete it fully and give it to the vendor. You should also keep a copy for your records.