APPORTIONMENT FOR INCOMES SUBJECT TO PCC CHAPTERS 7.12 OR 7.14
Administrative Rule Adopted by Revenue Bureau Pursuant to Rule-Making Authority
If business activity is conducted both within and without Portland by a Portland Business License Taxfiler subject to PCC Chapter 7.12 or 7.14, the net income is required to be apportioned using the single total gross income method. All gross incomes, including gross incomes subject to Chapters 7.12 and 7.14, are included in the denominator of the apportionment fraction. Incomes exempted under Business License Law, such as gross revenue subject to Chapters 7.12 and 7.14, are excluded from the numerator of the apportionment fraction.
Example: XYZ Electric Utility, Inc. provides electricity to customers located inside and outside Portland city limits. XYZ also has business activity other than as an electric utility. XYZ must pay a business license tax for the other business activity it conducts. However, electric utility revenues subject to a franchise fee upon utility gross revenue received from utility customers (PCC 7.14) are exempt from the Business License Law. Apportionment is calculated as follows:
Total gross income (everywhere) $2,000,000
Utility revenue subject to PCC 7.14 $500,000
Other Portland gross income $100,000
Net Income $1,000,000
Apportionment ($100,000 / $2,000,000) = 5%
Apportioned Income ($1,000,000 x .05) = $50,000
License Fee ($50,000 x 2.2%) = $1,100
Portland City Code Chapter 7.12
Portland City Code Chapter 7.14
Submitted for inclusion in PPD September 17, 2002.
Originally adopted as Bureau of Licenses Administrative Rule 610.93-9 November 23, 1993.
Revised administrative rule adopted by Director of Revenue Bureau August 10, 2009.