Oregon offers globally competitive incentives to encourage business expansion.
Property Tax Abatement
Enterprise Zones—In exchange for investing and hiring in an enterprise zone, businesses receive exemption from local property taxes on new plant and equipment for at least three years (but up to five years) in the standard program. In addition, many zones can offer special incentives for investments in qualifying rural facilities or in electronic commerce operations.
Strategic Investment Program (SIP)—The program exempts a portion of very large capital investments from property taxes for 15 years. The program is available statewide.
Construction-in-Process—Unfinished facility improvements may be exempt from local property taxes for up to two years while under construction with April 1 filing each year. In an enterprise zone, most authorized businesses enjoy a broader tax abatement using a different form.
Food Processing Machinery and Equipment (M&E)—For five years starting in or before 2025, newly operational M&E is exempt if certified by the Oregon Department of Agriculture. This exemption encompasses real or personal property used in the primary processing of many types of goods for human consumption with certain limitations. In some cases after 2019, local use of this exemption may be restricted by city or county ordinance.
State Income Tax
Oregon Investment Advantage—This program helps businesses start or locate new types of operations in a number of Oregon counties by providing an income tax subtraction, potentially eliminating state income tax liability on new operations over several years after they begin.
Income tax credits and other information at Oregon Department of Revenue
Other Programs
Federal Opportunity Zones—These new designations are designed to incentivize investments in low-income communities in exchange for tax benefits for investors.
Strategic Reserve Fund—a discretionary tool used for a variety of projects impacting economic development requiring an extensive vetting process, with the Governor making the final approval.
Oregon Business Expansion Program—This is a cash-based forgivable loan equivalent to the estimated increase in personal income tax revenue from new hiring.
Oregon New Market Tax Credit (NMTC) Program—delivers below-market-rate investment options to Oregon businesses and creates jobs in low-income communities. Applications are no longer being accepted.
Small Manufacturing Business Expansion Program—This is a cash-based forgivable loan for small manufacturing businesses’ expansion projects.
Solar Development Incentive Program—A program created by the 2016 Legislature that provides incentives to owners of photovoltaic energy systems that collect solar energy and distribute electricity.
Federal Work Opportunity Tax Credit—Congress provides this incentive to private-sector companies for hiring individuals from target groups, for which the state of Oregon has instituted systems to expedite and facilitate documentation.
Film & Video Incentives—Oregon offers programs to induce film and video productions:
- Rebate on 20% of the production’s Oregon-based goods and services
- Additional cash payment of up to 16.2% of wages paid to production personnel
Unlike other states’ programs, these film & video incentives are cash-based as opposed to tax credits. This simplifies and speeds up the process.
