Oregonians Could See Record $1.9 Billion ‘kIcker’ Next Year

SALEM, Ore. (AP) — Oregon could send out a massive $1.9 billion “kicker” tax refund next year due to surging income tax receipts.

Oregon Public Broadcasting reports if the projections hold, the refund — which takes the form of credits on 2021 tax returns filed next year — would be Oregon’s largest-ever kicker. The state’s unique kicker tax law sends money back to taxpayers whenever personal income tax revenues come in at least 2% above initial projections during a two-year budget cycle.

The new projection was delivered to a joint meeting of state senators and representatives Wednesday. In May, economic forecasters had anticipated the state would see a $1.4 billion kicker.

Under the anticipated kicker, the median income taxpayer would receive a $420 credit on this year’s state taxes. The average taxpayer, with an adjusted gross income of roughly $67,500, would receive $850. Since the kicker is awarded as a percentage of income taxes paid, the top 20% of earners stand to receive far more: between $1,600 and $16,880.

The state last hit a record kicker amount in 2019, the last time the refund was triggered, when more than $1.5 billion flowed back to taxpayers.

Separate from the personal kicker, the economists also expect the state to receive $847 million more in corporate taxes than initially expected. That “corporate kicker” will flow to K-12 schools.

“We have more money to invest in pandemic relief, childcare and housing,” Senate President Peter Courtney, D-Salem, said in a statement. “We’re still in a crisis.”

House Speaker Tina Kotek, D-Portland, called the forecast “welcome news” that could help lawmakers continue to focus on digging out of multiple crises.

Republican leaders, meanwhile, issued cautionary statements.

“Despite a budget that has doubled in 10 years, the state is worse off today for our students’ education, housing prices, and the safety of our communities,” said House Minority Leader Christine Drazan, R-Canby. “While it is great for the state that we have an increase in tax revenues, it is not the same thing as real progress for Oregonians.”