Idaho lawmakers introduce sweeping tax cut bill

Idaho lawmakers introduced an impressive-tax cut Bill that would slash assessments on all income brackets, lowering the sales tax from 6 percent to 5.3 percent by the beginning of next year.

The proposed bill was first introduced in a House committee after Republican Governor Brad Little called for new tax cuts, totaling $450 million. The Governor’s demands included $295 million in one-time cuts and $160 million in permanent tax cuts, with the new proposed bill estimating a tax relief of $284 million a year—the Associated Press reported.

As states across the country pile on debt because of economic shutdowns due to the coronavirus pandemic, Idaho is seeing a budget surplus of $600 million dollars and credits new residents flocking to the state, as well as federal relief, for the increase.

According to the Associated Press, the bill introduced in the House Revenue and Taxation committee would also eliminate a grocery tax credit, while leaving sales taxes on groceries in place. Lawmakers believe that eliminating the grocery tax credit, which allotted $100 a year for most people and $120 for those 65 and over, would save the state $165 million in fiscal years 2022 and 2023.

The proposal slated to go into effect January 1 of next year would reduce all income tax brackets, dropping the top bracket from 6.925 percent to 6.5 percent. According to the legislation, the cuts in sales tax, income tax and corporate tax comes at a deep cost. The proposed tax cuts would cost the state $265 million in 2022 and $435 million in 2023.

The bill sponsored by Republican House Speaker Scott Bedke and Republican House Majority Leader Mike Moyle, among other Republicans, estimate the provisions would leave Idaho with a $100 million budget surplus from 2022 to 2023.