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Mon., Jan. 21, 2013, 2:42 p.m.

Senator: Idaho Constitution says corporate personal property tax ‘shall never be relinquished or suspended’

Sen. Dan Schmidt, D-Moscow (Betsy Russell)
Sen. Dan Schmidt, D-Moscow (Betsy Russell)

As the Idaho Legislature this year looks into proposals to repeal or phase out the personal property tax on business equipment, Sen. Dan Schmidt, D-Moscow, is pointing to Article VII, Section 9 of the Idaho Constitution, which says, “Corporate property must be taxed. The power to tax corporations or corporate property, both real and personal, shall never be relinquished or suspended, and all corporations in this state or doing business therein, shall be subject to taxation for state, county, school, municipal, and other purposes, on real and personal property owned or used by them, and not by this constitution exempted from taxation within the territorial limits of the authority levying the tax.”

Schmidt, a physician and second-term senator, said, “I’ve asked a bunch of lawyers, the Attorney General, the Tax Commission, constitutional lawyers. They all say, nope, it doesn’t say that, even though it clearly says that to me, in clear language.” He said, “They cite the discussion that was had around that, as well as subsequent decisions  that have been made.” But Schmidt said as lawmakers consider proposals to do away with the $141 million annual tax – proceeds from which now go to local governments and schools – they should consider why the framers of the Constitution included that section. “They were saying something I think we should pay attention to,” he said.

Schmidt wrote about the issue on his blog, where he also recalls being billed for $1.25 a year in personal property tax when he first came to Moscow to practice medicine, to cover his equipment used in business – his medical school books and two stethoscopes. “Over the years I kept getting those bills but my valuation of the books diminished, and when the payment became less than the postage, they stopped,” he wrote. “Back then I was annoyed by this silly tax. … But as I now reflect, I think these are fair costs a citizen and businessman should pay to be in our state, our civic duty.” You can read his full post here.

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Betsy Z. Russell
Betsy Z. Russell joined The Spokesman-Review in 1991. She currently is a reporter in the Boise Bureau covering Idaho state government and politics, and other news from Idaho's state capital.

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