March 6 was Day 33 of the 2026 Oregon Legislative Session, and I’m pleased to report that the Legislature has adjourned sine die.

This year’s 35-day session was challenging (and unusual) because we don’t typically see legislators try to raise taxes in an election year. But with Democrats winning supermajorities in both chambers of the Oregon Legislature in 2024, and national Republicans getting the 2025 Federal Tax Bill over this finish line last July, there was little chance we weren’t going to see attempts by state leaders to push back against the victories of Congress and the President.

NFIB opposed two specific tax bills that ended up passing during the short session (more on that below). This is especially frustrating given all the recent rhetoric from Oregon’s top elected officials about the need for Oregon to refocus its efforts on prosperity, economic development, and business friendliness. But the good news is—that was the extent of the damage. Everything else, from bills relating to employment, lawsuits, energy, etc. were all stopped or amended to the point where NFIB was no longer opposed.

To our thousands of members in Oregon, our incredible member-activists, our dedicated Oregon Leadership Council members, and all the NFIB staff involved in making our state program a success, THANK YOU! We couldn’t do this important work without your engagement and support!

Here’s a brief recap of what happened in Salem this year during the 2026 legislative session:

Bad News: Two Tax Bills Passed

Senate Bill 1507 was originally introduced as a sales tax measure but ended up being the legislative vehicle for “disconnecting” from several provisions of H.R. 1, the 2025 Federal Tax Bill.

The bill expanded Oregon’s Earned Income Tax Credit (EITC) and created a new tax credit for job creation. It also disconnected from three provisions of H.R. 1:

— a deduction for interest on car loans ($36 million)

— a capital gains reduction for taxpayers who invest in qualified small business stocks ($39 million)

— and most notably, a disconnection from 100% bonus depreciation ($267 million).

NFIB testified in opposition in both public hearings on the measure.

100% bonus depreciation is a mechanism by which a business can purchase a piece of equipment or machinery and deduct the full cost of the purchase in the year it was placed in service rather than spreading that deduction out over the full depreciation schedule, which can be up to 20 years. This tax policy (along with Section 179 small business expensing, which thankfully was not included in the disconnect) provides an incredibly helpful incentive for businesses to invest in state-of-the-art, higher efficiency, equipment and machinery.

SB 1507 was an NFIB Key Vote for the 2026 legislative session. The bill passed in the Senate 17-13 and in the House 34-21, with five members excused.

Another tax bill that NFIB opposed this year was House Bill 4027. This legislation increased payroll taxes (albeit slightly) for businesses and their employees. That new money will go to the Bureau of Labor and Industries (BOLI) so the agency can investigate wage-and-hour and workplace discrimination claims.

The Workers’ Benefit Fund (WBF) assessment, which is currently 1.8 cents per hour worked per employee, is split evenly between employers and employees. The new increase will bring that figure to 2 cents per hour per employee. Funds from this payroll tax were historically limited to programs specifically related to injured workers. The only circumstances where WBF dollars went to BOLI was when the agency was tasked with investigating discrimination claims made by injured workers based on their status as an injured worker. That changed in 2025 when the Legislature authorized a one-time transfer of $15 million from the WBF to help BOLI address its wage claim backlog. HB 4027 created a new dedicated funding source based on this new relationship.

NFIB expressed major constitutional concerns about this bill during multiple public hearings – and at each one of those hearings, Legislative Counsel (the lawyers that work for the Legislature) were asked to explain on the record why this bill for raising revenue to fund a state agency’s core services, was not a bill for raising revenue. Clearly, we disagreed.

HB 4027 was an NFIB Key Vote for the 2026 legislative session. The bill passed in the House 33-11 with 16 members excused, and in the Senate 18-12.

This is significant because a three-fifths supermajority is needed in each legislative chamber to pass a bill for raising revenue. The Senate achieved that vote threshold, but the House did not, leaving the door open for a potential legal challenge.

Good News: Small Business & Big Labor

One of the ways we stop bad bills is when they are amended favorably to the point where NFIB is no longer opposed. This was the case for HB 4089, a bill dealing with criminal offenses related labor & employment.

When originally introduced, the bill would have subjected individuals and small business owners to felony charges for failing to correctly pay employees and independent contractors, even when the error was unintentional. It would have also made utilizing the services of an unlicensed contractor a felony punishable by five years in prison, a $125,000 fine, or both.

This was far too extreme a proposal, especially in light of the fact that the Legislature just passed a bill last session that imposes new liabilities on employers and property owners – a bill that went into effect January 1, 2026, that holds upper tier contactors and certain property owners liable for the illegal actions of their subcontractors (SB 426 from 2025).

HB 4089 was amended to significantly narrow the scope of the measure. The new felonies and corresponding punishments created by the bill will only apply to licensed construction contractors that intentionally hire an unlicensed labor contractor (which is already a misdemeanor offense) after previously being convicted of the same crime. The new penalties will also apply to contractors who use another contractor’s license without authorization with the intent to deceive the public.

While it was very alarming when the bill proponents first brought this concept forward, this is a great example of how the legislative process ought to work. One side had an idea (in this case, a labor union), but it was way too broad, so they worked with the opposition (the business community) to find a right-sized solution.

Great News: Protecting Insurance Affordability

This year, something happened in the Oregon House of Representatives that rarely occurs. A bill died on the floor. Many bills fail to pass during a legislative session, but usually they die when a key deadline is missed, a committee chair kills the bill in committee, or the legislature just runs out of time.

But that wasn’t the case for HB 4098, which would have added violations of Oregon’s insurance statutes to the state’s Unlawful Trade Practices Act (UTPA). When it came to floor for a vote, it failed to pass. House Republicans were joined by eight House Democrats in voting against the bill.

HB 4098 would have risked increasing insurance rates at a time when Oregonians and their businesses cannot afford any additional cost burdens. It would have moved Oregon’s insurance market away from a regulatory model to one that incentivizes litigation.

Additional enforcement under Oregon’s UTPA would have led to more lawsuits and increased costs for insurers. This would create market pressure to increase premiums for insurance customers. As a result, Oregon consumers and businesses would have to pay more for the same coverage or leave themselves under-insured if they cannot afford to pay more.

This was a huge legislative victory and one of the most bi-partisan floor votes in opposition to a measure in recent Oregon history! It’s a great reminder that Oregon lawmakers are still capable of forming a pro-small business majority on a very controversial issue.

HB 4098 was an NFIB Key Vote for the 2026 legislative session. The bill failed to pass in the House by a vote of 28-30, with two members excused.

Additional (Dead) Bills of Note

NFIB opposed the following bills, all of which failed to pass:

• SB 1505: Labor Standards Board – Failed to move out of Senate committee
• SB 1511: Estate Tax Threshold/Rate Increase – Passed in the Senate, failed to move out of House committee
• SB 1541: Climate Superfund – Passed out of Senate committee to Ways & Means, failed to move to the floor
• HB 4147: Employer/Medicaid Shame List – Passed in the House, failed to move to the floor in the Senate

Prior Legislative Reports

• February 21: NFIB Victory—Bill Incentivizing Litigation Fails
• February 7: 2026 Session of Oregon Legislature Commences