Who would contribute to the proposed payroll tax and how much would it cost?

A payroll tax is levied as a percent of gross payroll earned within the taxing jurisdiction. Entities can enact a payroll tax on employees and/or on employers. 


At their May 8 Work Session, Councilors were provided three versions of a possible payroll tax and moved forward with an option that included a rate of .0040 for employees and a rate of .0020 for employers located within the City of Eugene. This option also capped the rate for minimum wage earners at .0020. 


Proposed Monthly Cost to Employees at Various Hourly Wages

Tax Rate$14/hr$15/hr$16/hr$18/hr$20/hr$22/hr$24/hr
0.0040$10/month$10/month$11/month$12/month$14/month$15/month$17/month


Proposed Monthly Cost to Minimum Wage Employees

Tax Rate$12/hr*
0.0020$4/month

* As of July 1, 2020, the minimum wage in Eugene will be $12 per hour.


Proposed Monthly Cost to Employer with Annual Gross Payroll of $500,000

Tax Rate
0.0020$83/month


The revenue team recognized that the payroll tax doesn’t impact every segment of the population. It would not capture revenue from visitors, city residents employed elsewhere, retirees and the unemployed. The revenue team, however, thought that this approach was the most clear and fair of the final options considered.

Show All Answers

1. Why do the City’s community safety services need more funding?
2. Why is a payroll tax being considered?
3. What is a payroll tax?
4. Who would contribute to the proposed payroll tax and how much would it cost?
5. What do I get for my money?
6. How will the City be held accountable with money earned from the payroll tax?
7. Where does Community Safety funding come from now?
8. Why isn’t money from the marijuana tax, or other taxes, being used instead of a payroll tax?
9. Can I submit written comments online about the proposed payroll tax ordinance?
10. Will I get to vote for the payroll tax?
11. If implemented, how long will it take for the tax to go into effect?
12. Does Oregon have a payroll tax?