In case you’ve been eyeballing a new bike, you may want to purchase it before the year’s end, at least in Oregon. Beginning next year, biking is set to become more costly for some after Oregon made headlines as the first state to impose a bicycle excise tax.
Gov. Kate Brown (D) is expected to sign H.B. 2017, a major transportation package, into law. The bill will impose a $15 excise tax on the sale of new bicycles that have a retail sales price of $200 or more and with a wheel diameter of at least 26 inches. Retailers will be required to collect the tax at the time of sale. They will also be required to submit quarterly returns to the Department of Revenue and keep sales records for five years from the time of the sale.
The bicycle tax is estimated to raise approximately $1.2 million per year for projects “that expand and improve commuter routes for nonmotorized vehicles and pedestrians, including bicycle trails, footpaths and multiuse trails.”
H.B. 2017 also provides for a $0.04 gas tax increase in January 2018 and then a $0.02 increase every other year until 2024, a vehicle registration fee increase for both electric and gas vehicles, a 0.5 percent tax on new car sales, and a 0.1 percent payroll tax on all employees.
Oregon is the first state to impose a tax on bicycles. But on the local level, Colorado Springs, Colo., has imposed a bicycle excise tax since 1988. The city imposes the $4 tax on the sale of new bicycles with a wheel diameter larger than 14 inches, including bicycles with training wheels. The revenue generated from this tax is used to construct off-street bicycle paths and improve other bikeways. In contrast, Oregon’s bicycle tax will only apply to some larger adult bicycles.
In a year where many cash-strapped states are increasing taxes and fees to fund infrastructure needs, Oregon has again taken an exceptional approach to generating needed revenue. Oregon was also one of the first states to implement a voluntary per-mile driving fee program, OReGO, imposed in lieu of the traditional gas tax. That being said, H.B. 2017 also proposes to increase the per-mile usage charge by $0.01 every other year beginning Jan. 1, 2018, through Jan. 1, 2022. Will Oregon’s bold measure to make bicyclists pay for the trails spur other states to consider similar measures?
Continue the discussion on Bloomberg BNA’s State Tax Group on LinkedIn: Do you think a bicycle tax will catch on in other jurisdictions expanding their transportation budgets? Is a bicycle tax the best way to fund cycling infrastructure?
Get a free trial to Bloomberg BNA Tax & Accounting's State Tax solution, a comprehensive research service that provides deep analysis and time-saving practice tools to help practitioners make well-informed decisions.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)