About the ta​x

On May 16, 2019, Governor Kate Brown signed House Bill 3427 into law.

The legislation accomplishes the following:

  • Establishes a "Fund for Student Success" that is separate and distinct from the state's general fund.
  • Adopts a new Corporate Activity Tax (CAT) imposed on all types of business entities.

The CAT is in addition to the state's current corporate income tax. Revenue from the CAT will be transferred to the Fund for Student Success and will be used for education spending. 

If you would like to sign up for additional information as it becomes available, please subscribe to our mailing list.​

​​Frequently asked questions

​​A: The new Corporate Activity Tax (CAT) is imposed on businesses for the privilege of doing business in this state. The CAT is not a transactional tax, such as a retail sales tax, or an income tax. Oregon’s CAT is measured on a business’s commercial activity–the total amount a business realizes from transactions and activity in Oregon. Certain items are excluded from the definition of commercial activity and, therefore, will not be subject to the CAT. In addition, Oregon’s CAT allows a 35% subtraction for certain business expenses.

The CAT is applied to Oregon taxable commercial activity in excess of $1 million. The tax is computed as $250 plus 0.57% of Oregon commercial activity of more than $1 million. Only taxpayers with more than $1 million of taxable Oregon commercial activity will have a payment obligation.

The Department of Revenue has begun developing administrative rules for the new CAT program. We encourage all stakeholders to provide feedback. Please send any comments to

If you would like to receive updates on the CAT, please subscribe to our mailing list using the form on this webpage.

A: The CAT is applicable to tax years beginning January 1, 2020. The CAT is an annual calendar year tax. Businesses that use an alternate fiscal year must still file and pay based on the calendar year.

A: Commercial activity is the total amount realized by a company from the transactions and activity in the regular course of their business in Oregon. While commercial activity includes most business receipts, receipts from certain items are excluded and are not subject to the CAT. For example, the following items are excluded:

  • Receipts from the sale of motor vehicle fuel.
  • Receipts from the wholesale and retail sales of groceries.
  • Sales of items or services that are delivered outside of Oregon.
  • Receipts from a farmer’s sales to agricultural cooperatives that are exempt from income tax.
  • Property, money, or other amounts received by an agent on behalf of another in excess of the agent’s fee or commission.
  • Receipts from transactions between members of the same unitary group.
  • Distributive income received from a pass-through entity.

These are only a few of the items not subject to CAT. The CAT legislation has a list of items that are excluded. See Section 50 of HB 2164 (2019).

​A: Any business, or unitary group of businesses, doing business in Oregon may have responsibilities under the CAT. This includes all business entity types, such as C and S corporations, partnerships, sole proprietorships, and other entities.

The CAT sets four thresholds to determine whether a business or unitary group has CAT responsibilities. These thresholds are based on the amount of commercial activity the business or unitary group earns in Oregon over the course of the year.

​Threshold ​Amount ​Explanation
Excluded–No Requirement​ Less than $750,000​ ​Business or unitary group with less than $750,000 of Oregon commercial activity are excluded from all CAT requirements.
​​Registration Threshold $750,000+​ ​Business or unitary group with Oregon commercial activity in excess of $750,000 must register for the CAT.
Filing Threshold $1 Million​ ​Business or unitary group with Oregon commercial activity of $1 million must file a return.
Tax Payment Threshold​ ​More than $1 Million Business or unitary group with taxable Oregon commercial activity in excess of $1 million must file a return and pay tax.​

If you are unsure whether your business is part of a unitary group, please see our Unitary Group FAQ.

A: ​The CAT legislation excludes certain types of business entities from any CAT liability, unless such business has unrelated business taxable income under federal law. Exempted entities include but are not limited to:


A: ​The CAT is an annual calendar year tax. CAT returns are due each year on April 15. Generally, estimated payments are due April 30, July 31, October 31, and January 31 for the preceding quarter.

​ ​ ​Important Filing Dates
Filing or Payment Requirement​ ​Period Dates Due Date
1st Quarter Estimated Payment​ January – March ​ April 30
2nd Quarter Estimated Payment​ April – June​ July 31
​3rd Quarter Estimated Payment ​July – September October 31
​4th Quarter Estimated Payment ​October – December January 31
Annual Return ​ January – December ​ April 15

A: Registration is due within 30 days of meeting the $750,000 registration threshold. A penalty of $100 per month may be assessed for failing to register, up to $1,000 per calendar year. 

A: The tax rate for the CAT is 0.57% of taxable commercial activity over $1 million plus $250. Businesses with less than $1 million of taxable commercial activity will not have a payment obligation.

To calculate your business’s CAT liability, you will need the following information:

  • Amount of commercial activity sourced to Oregon. Determine the total amount of commercial activity sourced to Oregon that the business realized over the course of the year. Do not include receipts from items that are specifically excluded from commercial activity. This is your Oregon Commercial Activity (OR CA).
  • Cost subtraction. Taxpayers may subtract 35% of either labor costs apportioned to Oregon or 35% of cost inputs apportioned to Oregon. Do not include labor costs or cost inputs that are attributable to excluded items. The larger amount is your cost subtraction (CS).

Step 1: (OR CA – CS) - $1 million threshold = Taxable OR CA
Step 2: (Taxable OR CA x 0.57% tax rate) + $250 minimum tax = CAT Liability

Alpha Corp sells widgets to Oregon customers. In 2020, Alpha Corp realized $20 million dollars of commercial activity in Oregon. Labor costs apportioned to Oregon were $1 million. Cost inputs apportioned to Oregon were $5 million. Alpha will subtract 35% of their cost inputs (35% of $5 million = $1,750,000).

Alpha Corp 2020​ ​
​​Oregon Commercial Activity (OR CA) ​$20 million
Cost Subtraction (35% of $5 million)* ​$1.75 million

To calculate Alpha Corp’s CAT payment:
Step 1: ($20 million OR CA - $1.75 million CS) – $1 million threshold = $17,250,000 taxable OR CA
Step 2: ($17,250,000 x .0057) + $250 minimum tax = $98,575 CAT liability

A: ​You must use the same accounting method you use for your federal income tax return.

A unitary group is a group of entities that form a unitary business enterprise in which members share or exchange value. A unitary group of entities is united by more than 50% common ownership.

In addition, a unitary business enterprise exists if at least one of the following conditions is met:

  • Centralized management or a common executive force;
  • Centralized administrative services or functions resulting in economies of scale; or
  • Flow of goods, capital resources or services demonstrating functional integration.

Members of a unitary group may be in the same general line of business, such as manufacturing, wholesaling or retailing. Or, members may be in multiple lines of business that constitute steps in a vertically integrated process, such as the steps involved in the production of natural resources, which might include exploration, mining, refining, and marketing.

Unitary groups must register, file, and pay as a single taxpayer.

A: Visit our website at Click on the "Business" link, then the "Corporate Activity Tax" in the "Information" column on the next page. We have a mailing list registration for future updates. Also, you can email your questions to

​​A: A taxpayer expecting more than $5,000 of Corporate Activity Tax liability for the calendar year must make estimated payments. CAT liability of $5,000 for the year corresponds with taxable commercial activity equal to $1,833,245. Taxable commercial activity is Oregon-source commercial activity less the subtraction allowed for a percentage of eligible costs. Estimated payments are due April 30, July 31, October 31, and January 31 for the preceding calendar quarter. A taxpayer expecting $5,000 or less of CAT liability for a calendar year doesn't need to make estimated payments but still must file an annual return and pay CAT liability no later than April 15 of the following calendar year.