The House has voted 47-20 to pass HB 245a, the bill sponsored by the Idaho Association of Commerce & Industry to phase in a $100 million property tax break for businesses by eliminating the personal property tax on business equipment. The bill now moves to the Senate.
Opponents said the bill – which would shift the first-year cost of the tax break, just under $10 million, to other property taxpayers – would undo part of the benefit of last year’s first-ever increase in the homeowner’s exemption. “We will have given property tax relief, and then we will have taken it away,” said Rep. Margaret Henbest, D-Boise. Added Rep. Nicole LeFavour, D-Boise, “I think we really are going in the wrong direction here.”
But backers said the bill does away with an unfair and cumbersome tax on business equipment. “Yes, for this year, we do shift some taxes,” said House Tax Chairman Dennis Lake, R-Blackfoot. “I challenge anyone, anyone to justify personal property tax. I find no justification for it whatsoever.”
Rep. Ken Roberts, R-Donnelly, a co-sponsor of the bill, told the House, “It’s the people who demand services who drive the taxes up, so to argue that residential is not paying their fair share, let’s take a look at how many of the services that are being demanded are actually being demanded by residential, and paid by all of us.”
Rep. Scott Bedke, R-Oakley, sounded a similar note. “You need to ask yourself who is demanding the services” that impact county budgets, he said. “Is it ag? Is it mining and timber? I don’t think so. It is residential.”