Special session tax cut bill crosses first hurdle
By Ruth Brown, Idaho Reports
Idaho lawmakers came back to Boise on Thursday morning, kicking off their extraordinary session with a bill modestly different from what Gov. Brad Little pitched last week.
The bill, should it pass, would result in an overhaul of Idaho’s tax code, grant tax rebates and create $400 million in funding for education.
Little’s first bill would have increased the amount put into the new education fund by 3% each year to adjust for inflation, starting in fiscal year 2025 and every year thereafter. That provision has since been removed from the bill.
The bill was introduced by the House Revenue and Taxation Committee in a unanimous voice vote. It must now go to the full House of Representatives before returning to a committee hearing that takes public testimony.
Rep. Steven Harris, R-Meridian, introduced the bill before the House tax committee.
“Why a special session?” he said. “From my point of view, we have a boatload of money that needs to be dealt with appropriately.”
Sen. Jim Rice, R-Caldwell, told Idaho Reports that the tax committees plan to hear citizen testimony jointly before voting on the bill separately.
What would the bill do?
Little previously said he called the extraordinary session in an effort to deal with high inflation rates.
The wide-ranging bill includes both tax cuts and rebates, but also the establishment of new education funds. That’s generally unusual to see in one bill.
If passed, the bill would:
- Create a flat income and corporate tax of 5.8 percent
- Give $300 in tax rebates to individuals and $600 to joint tax filers, or 10 percent of the 2020 income tax filing, whichever is higher
- Distribute $330 million annually to K-12 education
- Distribute $80 million annually to a newly created in-demand careers fund
The legislation includes $500 million distributed to Idaho residents in income tax rebates and more than $150 million in ongoing tax cuts.
This comes as Little said Idaho’s budget surplus is closing in on a record-breaking $2 billion.
Follow the Idaho Reports blog on Thursday for updates throughout the day.