Ore. measure proposing Ore. tax deduction fails

PORTLAND, Ore. - Voters have rejected a ballot measure that would have allowed taxpayers to deduct all of their federal income taxes on their state income-tax returns.

With 42 percent of ballots counted, the vote was 63 percent to 37 percent Tuesday.

Officials estimated Measure 59 would have slashed Oregon's budget by more than $1 billion.

Supporters say the proposal would have provided tax relief during tough economic times. Opponents say it would only benefit Oregon's wealthiest residents.

With the measure's rejection, Oregonians can deduct no more than $5,500 of their federal income taxes from their state income tax returns.

Voters rejected a similar proposal in 2000.

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