City Council Raises Arts Tax to $50

The Portland City Council on Wednesday passed an ordinance raising the Arts Tax to $50 per person per year starting in 2027, and pegging it to inflation after that.

Councilors say the increased rate will bring in additional revenue for arts programming, while also exempting low-income Portlanders from paying the tax. The resolution passed 7–5.

The tax’s main purpose is to give K-5 schools money to hire arts teachers. It was first approved by ballot measure in 2012 at a rate of $35 per person per year. That rate did not increase with inflation, resulting in an average 2 percent loss per year in revenue between 2017 and 2025.

Because of that loss, says a presentation from Council President Jamie Dunphy’s staff, the tax was in danger of being unable to hire arts teachers in coming years. “The arts tax started running out of money for artists last year,” the presentation reads. “Without Council action, it will begin to run out of money for schools in ~5 years.”

Those with Oregon taxable income under $20,000 (or $40,000 if filed jointly) are exempted under the new ordinance. That change is expected to exempt 214,000 people. Under the previous system, anyone making more than $1,000 per year had to pay.

“Portlanders love art, Portlanders love kids, everyone hates the Arts Tax,” said Dunphy, the policy’s main sponsor, at a May 13 hearing. “We are doing as best as we can to try and make this less annoying and sustainable for the future.” He added that he is “very open” to further overhauls of the tax.

The Portland Metro Chamber has previously threatened to sue the council if they raised the Arts Tax without first consulting voters.

“In public letters the last two years, the Chamber has transparently informed the Council that under the Portland Charter, the Council does not have the authority to increase or adopt new taxes without voter authorization. Yet the Council chose to proceed anyway without even seeking an independent legal analysis, and in doing so, have put the City and the Council itself at legal risk,” Metro Chamber CEO Andrew Hoan wrote in a statement to WW this week. “This disregard for the City Charter, Oregon Law, and the will of voters warrants legal scrutiny.”

Robert Taylor, the city’s attorney, said at a May 6 hearing that the council had the authority to change the tax without referring it to voters first.

Councilors who opposed the ordinance said they wouldn’t vote to increase taxes on Portlanders, especially a tax not adjusted for income. Multiple councilors argued the increase should instead be sent back to voters.

“I think this is an example where the phrase ‘putting lipstick on a pig’ is really unfair to pigs, because pigs are smart and the Arts Tax is stupid,” said Councilor Steve Novick at a May 13 hearing. He voted against the ordinance and also opposed the original tax in 2012.

Funds from the tax are given first to school districts to hire certified arts teachers in K-5 schools at a ratio of one teacher per 500 students. Funds then go to the Office of Arts and Culture to support arts education. Any leftover money is largely given as grants to local arts organizations that serve Portland K-12 schools or underserved communities.

The Arts Tax still has to be paid separately from state tax returns under this ordinance. Combining it would be too complicated, the city said.