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Yes, you have to show an OR photo id. Driver's license is most common as it would show your state of residency.
My SIL and I were in Kesselring's a few years ago, and SIL made a purchase. Kesselring's wanted 2 forms of OR picture ID so SIL gave him his OR DL and his OR CHL. Kesselring's did not charge him the sales tax.
Agreement says proper ID...what proper ID is can be up to the retailer.