House Majority Leader Mike Moyle, R-Star, is proposing legislation this morning to cut Idaho’s corporate and individual income tax rates, in all brackets, by a tenth of a percent a year for the next six years. The cost to the state general fund would be roughly $21 million a year for each cut, for a total of $126 million a year by the sixth year. By the end, that would bring Idaho’s top individual and corporate income tax rate down to 6.8 percent from the current 7.4 percent, which Moyle noted is below Montana’s rate of 6.9 percent.
“When you talk to businesses coming to Idaho, the big thing they talk about is your income tax rates are out of whack,” Moyle said. “Compared to surrounding states and the national average, we’re too high. If we want to draw good-paying jobs, we’ve got to be competitive.” He added, “It affects all taxpayers, low-income to high-income.”
Moyle’s bill includes a “trigger” – if state revenue doesn’t grow by at least 3 percent in any of the six years, the cut wouldn’t take effect that year. The bill would take effect Jan. 1, 2015, “not ’14, so we take care of the schools,” Moyle said. He said the price tag is just an estimate. “I hope the impact is more, because that means the economy is going,” he said. “If something goes wrong, we don’t do it.”