February 20, 2021 11:30 a.m.

Congressman Peter DeFazio has urged that Governor Kate Brown and legislative leaders ensure that COVID-19 Economic Impact Payments do not contribute to the tax liabilities of working-class Oregonians for 2020.

DeFazio said, “It is unconscionable to ask the very families who have struggled the most during the COVID-19 crisis to include these payments in their tax liability”. He said while the pandemic has caused a budget shortfall for the state, the state shouldn’t ask Oregonians to bear the brunt of that shortfall on their backs.

DeFazio said while Congress intended EIP’s to be tax-free, current Oregon state statutes will result in hundreds of thousands of Oregonians being indirectly taxed at the state level. The release said data from the Oregon Legislative Revenue Office shows that EIP’s included in the CARES Act will result in approximately 870,000 Oregonians seeing an increase in their state tax liability to the tune of more than $100 million.

DeFazio said this indirect tax will disproportionately impact individuals earning between $20,000 and $70,000 and families earning between $50,000 and $100,000 annually.

In a letter to state leaders, DeFazio said the next COVID-19 relief bill – likely to be signed into law in the coming weeks – is estimated to include approximately $4.1 billion, including $2.6 billion given directly to the state, to help cover Oregon’s projected budget shortfall.