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Dispatches from public radio's correspondent at the Oregon Legislature. This is a venue for political and policy coverage of the state government in Salem and its impact on the people of Oregon.

Oregon House Democrats Roll Out Business Tax Proposal

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File photo of the Oregon House Chambers at the state Capitol in Salem.

Oregon House Democrats pitched a plan to overhaul the way the state taxes businesses Thursday. The proposal is part of an effort to bridge a $1.6 billion shortfall in the upcoming budget.

Under the proposal, most Oregon businesses would pay a flat tax of $250 per year. Those with Oregon sales that top $5 million a year would pay a 0.95 percent tax on sales.

The new tax would replace the existing corporate income tax, which is based on a company's profitability.

Nancy Nathanson is the chief budget writer for House Democrats. She said the goal is to do more than simply patch up the short-term spending plan.

"Instead of ending up with something mediocre, is there something new we can do and make a significant new investment in education that will actually move the dial,” she said.

Nathanson said the proposal would raise $2.1 billion for the upcoming budget cycle. Its fate is unclear, as it would need some Republican support to be approved.