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Oregon’s Statewide Transit Tax is a one-tenth of 1 percent or .001 payroll tax first enacted by the Oregon Legislature in House Bill (HB) 2017 (2017).
During a special session in 2025, the Legislature adopted HB 3991, signed into law by Governor Tina Kotek in November. It includes amendments to Oregon Revised Statutes (ORS) 320.550 to increase the rate to two-tenths of 1 percent or .002 beginning January 1, 2026.
HB 3991 provides emergency funding to keep Oregon’s roads, bridges, and transit systems safe and working.
After the special session, petitioners began collecting signatures for Initiative Petition 302, which would refer HB 3991 to Oregon voters for consideration.
On December 12, 2025, petitioners submitted signatures to the Oregon Secretary of State to refer the bill to the voters. While signatures are being validated, the Department of Revenue (DOR) is pausing implementation of the rate increase and employers should continue to withhold at the .001 rate.
If the bill is successfully referred to the ballot, the rate increase pause will remain in effect pending the result of the election. DOR will continue to provide updates to employers throughout this process on our website, and we welcome any questions you may have. Contact DOR at payroll.help.dor@dor.oregon.gov.
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