Legislative Revenue Office outlines how Oregon's corporate activities tax is calculated and who it covers

Chair Meek called the Senate Committee on Finance and Revenue's informational session on the corporate activities tax (CAT) to order and invited staff from the Legislative Revenue Office to present a policy-level overview.

Michael Dowdy, an analyst with the Legislative Revenue Office, told the committee the CAT is a tax on Oregon commercial activity and described how the tax is defined and calculated. He said commercial activity is the total amount realized from transactions and activities in the regular course of a person's trade or business "without deductions for expenses incurred by the trade or business." Dowdy emphasized that exports are excluded from Oregon commercial activity.

Dowdy summarized the statute's substantial-nexus tests that can subject nearly any business type to the CAT if they have sufficient ties to Oregon. Examples he listed that establish nexus include: owning or using capital in Oregon; a certificate from the Secretary of State authorizing the business to do business in Oregon; $50,000 in Oregon property or payroll; $750,000 in commercial…