Modifies the provision that exempts receipts from the sale by certain pharmacies of prescription drugs to allow use of the exemption by critical access pharmacies and to require pharmacies allowed the exemption based on the number of locations to have at least one location in this state.

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83rd OREGON LEGISLATIVE ASSEMBLY--2025 Regular Session
A-Engrossed
Senate Bill 123
Ordered by the Senate June 12
Including Senate Amendments dated June 12
Printed pursuant to Senate Interim Rule 213.28 by order of the President of the Senate in conformance with pre-
session filing rules, indicating neither advocacy nor opposition on the part of the President (at the request
of Senate Interim Committee on Finance and Revenue)
SUMMARY
The following summary is not prepared by the sponsors of the measure and is not a part of the body thereof subject
to consideration by the Legislative Assembly. It is an editor’s brief statement of the essential features of the
measure. The statement includes a measure digest written in compliance with applicable readability standards.
Digest: The Act makes changes to the CAT. (Flesch Readability Score: 100.0).
[Digest: The Act tells the LRO to study the corporate activity tax. (Flesch Readability Score:
64.9).]
[Requires the Legislative Revenue Officer to study the corporate activity tax. Directs the Legislative
Revenue Officer to submit findings to the interim committees of the Legislative Assembly related to re-
venue not later than December 1, 2026. ]
Modifies the provision that exempts receipts from the sale by certain pharmacies of
prescription drugs to allow use of the exemption by critical access pharmacies and to require
pharmacies allowed the exemption based on the number of locations to have at least one lo-
cation in this state.
Applies to tax years beginning on or after January 1, 2026.
Removes the sunset from the exclusion for subcontracting payments.
Takes effect on the 91st day following adjournment sine die.
A BILL FOR AN ACT
Relating to the corporate activity tax; creating new provisions; amending ORS 317A.123 and section
59, chapter 579, Oregon Laws 2019; and prescribing an effective date.
Be It Enacted by the People of the State of Oregon:
SECTION 1.
ORS 317A.123 is amended to read:
317A.123. (1) As used in this section:
(a) “Eligible pharmacy” means a pharmacy that has [ nine or fewer locations under common
ownership in this state ] at least one but fewer than 10 locations under common ownership in
this state or a critical access pharmacy, as defined by the Oregon Health Authority by rule
for purposes related to the Oregon Prescription Drug Program . “Eligible pharmacy” does not
include a pharmacy that caters primarily to veterinary customers.
(b) “Pharmacy” has the meaning given that term in ORS 689.005.
(2) Notwithstanding ORS 317A.100, amounts received by an eligible pharmacy in receipt for the
sale of prescription drugs are excluded from the definition of commercial activity and are exempt
from the tax imposed under ORS 317A.116.
SECTION 2.
The amendments to ORS 317A.123 by section 1 of this 2025 Act apply to tax
years beginning on or after January 1, 2026.
SECTION 3. Section 59, chapter 579, Oregon Laws 2019, is amended to read:
Sec. 59. [ Section 58 of this 2019 Act ] Notwithstanding ORS 315.037, ORS 317A.122 applies to
all tax years beginning on or after January 1, 2020[ , and before January 1, 2026 ].
NOTE: Matter in boldfaced type in an amended section is new; matter [ italic and bracketed] is existing law to be omitted.
New sections are in boldfaced type.
LC 3631
A-Eng. SB 123
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SECTION 4.
This 2025 Act takes effect on the 91st day after the date on which the 2025
regular session of the Eighty-third Legislative Assembly adjourns sine die.
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