Yesterday, the Oregon House of Representatives approved two revenue bills that, combined, would raise an estimated $733 billion to fund state programs and services over the next fiscal biennium. The Oregon Senate is expected to follow suit, and Gov. Ted Kulongoski is certain to sign it. From there, the measures may be referred to voters via the referendum process. As reported in The Oregonian (Portland, Ore.):

House Bill 2649 establishes a new, higher tax bracket of 10.8 percent on income above $125,000 for single filers and above $250,000 for households. A rate of 11 percent would apply to households above $500,000. The current top tax rate is 9 percent. The new rates would raise an estimated $472 million over the next two years.

The other measure, House Bill 3405, hikes taxes on corporations. Under the bill, Oregon’s $10 minimum tax on corporations would change to a sliding scale between $150 and $100,000, depending on revenue. It also would set a rate of 7.9 percent for corporate income above $250,000, dropping to 7.6 percent after 2011. The higher corporate taxes would raise an estimated $261 million over the next two years.

Under this bill, a corporation with income of $1 million would pay 7.9 percent tax on the portion over $250,000, or 7.9 percent of $750,000, which translates to $59,250. That’s not insignificant. How will this affect small businesses, particularly nurseries, in Oregon?