Eye On Boise

Ways & Means introduces sweeping tax cut bill

Posted by Betsy

April 5, 2011 10:28 a.m. • 11 comments

The House Ways & Means Committee met just now and voted along party lines to introduce new legislation from Rep. Marv Hagedorn, R-Meridian, calling for big cuts in personal and corporate income taxes to be phased in over the next eight years, for a total drop in state tax revenue by 2019 of $402 million. “History tells us that the last five times this has been done nationally, the economy has soared, business has thrived,” Hagedorn told the panel. “This is the right idea to bring jobs to the state of Idaho.”

House Majority Leader Mike Moyle, R-Star, said the plan was simply to introduce the bill, not to take it any further this year. He called it “no more than giving them something to work with,” as discussions continue on the concept between this year and next year. House Minority Leader John Rusche, D-Lewiston, said, “I have real concerns” about such legislation at a time when the state's reserve funds are empty and budgets are being cut. House Assistant Majority Leader Scott Bedke, R-Oakely, said, “I think this is a topi that needs to be further discussed, further refined. … I don't think there's any question that it'll be the private sector that'll lead us out of this doldrum.”

The committee also voted to introduce a new renewable energy rebate bill, as part of plans to split the compromise measure that already has passed the House into two separate bills; the other piece already was introduced on the Senate side.

11 comments on this post so far. Add yours!

scott_nicholson on April 05 at 10:43 a.m.
Tax cuts make sense at certain points in economic times. Not when the state coffers are empty, however. Did he also propose ending all corporate subsidies? People speak of high tax rates, but there should be no discussion on that point without a proper analysis of “effective tax rates.” There’s a big difference.
eagleproducer on April 05 at 11:00 a.m.
It is a bald faced lie to state the “last five times” tax cuts were enacted they produced a brighter economy. The Bush tax cuts are now over ten years old Ask yourself, was the nation in better or worse shape economically now or ten years ago?

The greatest expansion in the history of the U.S. economy occurred when top rates on top earners were near 90%.
BlueIdahos on April 05 at 11:00 a.m.
@ScottNicholson, America has the HIGHEST tax rates in the world. Jobs are continuing to move overseas becasue why would companies want to pay these OUTRAGEOUS TAXES?

Same thing in Idaho-Across the board tax cuts will spur job growth and economic prosperity unseen since the Ronald Reagan era(when he cut the massive tax rates of his predecessor, Jimmy Carter(aka Barack Obama the first.)
BobEly on April 05 at 11:06 a.m.
BlueIdahos: ‘Tis better to be thought a fool than to open one’s mouth and remove all doubt.
elvislution on April 05 at 11:13 a.m.
@Blueidahos: keep toeing the line, don’t bother using that thing between your ears.

If we have the highest corporate taxes in the world, why do so many corporations pay NOTHING in taxes? The answer: we might have a high tax RATE, but we certainly don’t have a highest marginal tax rate. In reality (and I’m a fan of reality, I can’t deny it), businesses don’t pay a lot in taxes.

And the link between tax cuts and economic growth is highly overstated. Think about it - the Bush tax cuts ushered in the worst economy in years.
BlueIdahos on April 05 at 11:18 a.m.
@Elvislution, Thanks for making my argument for me. The reason some big corporations pay little or nothing in taxes is because they take advantage tax loopholes(eg, moving corp. HQ to Ireland or Sweden).

Have you taken a look at the federal tax code? What we need is tax reform, with a simplified code and an across the board flat rate in the 15-20% range.
yabetcha on April 05 at 11:26 a.m.
Democrats have been clamoring for a tax increase on smokers, even holding their own rump session, a so called public hearing, on a proposal while Republicans introduce a tax reduction as seed for thinking about during the interim to the next session.

If the economy improves to bring in lots of tax revenue, GOP can run with the bill next year and chide the Democrats for picking on smokers.
slfisher on April 05 at 4:10 p.m.
The agenda for this bill wasn’t posted until midday and they chose a room without audio streaming on the Internet. Why the secrecy?
fortboise on April 05 at 4:38 p.m.
Even if Hagedorn’s Comics Illustrated version of history were true about the fortunes of our national economy, its application to the state of Idaho would be about midway between dubious and fatuous.

Perhaps they want the deliberations as secret as possible to avoid embarrassment?

But then our solons don’t embarrass easily, do they?
yabetcha on April 05 at 6:16 p.m.
Yeah, really secret meeting. Notice the open door obviously taken by a photojournalist and possibly with a reporter standing against the door jamb in the picture above.
riverside67 on April 06 at 7:39 a.m.
Repeatedly saying over and over that cutting taxes boosts the economy and therefore increases revenue won’t make it anymore true. Repeatedly saying that Reagan cut taxes in ‘81 and the economy took off and prospered won’t make that any more true either. Does nobody remember the recession of ‘82/‘83?

In fact, the opposite is true. In truth, the most stable, viable, vital and robust economy we have enjoyed since 1980 was during the Clinton Administration. In that time, the economy ran well, the federal government ran budget year surpluses, the federal deficit was reduced and Idaho prospered as well.

Rather than reinventing and twisting history to suit poltical ideology, Hagedorn ought to really take a hard look at the policies of that era, and emulate them if he is truly interested in moving Idaho forward.

The bill he introduces here is essentially the same one he introduced this time last year, and it is devasting to the Idaho economy as it represents a total disinvestment in the infrastructures upon which all private sector economic activity depends.