Under ORS 657.480, a person (employer) may not engage in or advise
another person (employer) to engage in activity to transfer or acquire,
or attempt to transfer or acquire, a trade or business or any portion of
a trade or business solely or primarily for the purpose of obtaining a
lower unemployment insurance (UI) tax rate.
If a person (employer)
knowingly engages in such activity, the highest UI tax rate (currently
5.4%) will be assigned to that trade or business for the tax year in
which the activity occurred and for the next three years. However, if
the person (employer) is already subject to the highest tax rate for the
year or if the amount of increase in the tax rate is less than 2%, an
additional penalty tax rate of 2% will be added to the calculated tax
In addition, if a person (employer) advises another person
(employer) to engage in this activity, they may be assessed a civil
penalty not to exceed $10,000. Criminal penalties for engaging in tax
avoidance schemes may also be imposed.