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Eye On Boise

Tax Working Group meeting again, looks at impact of personal property tax break…

Legislators on the Tax Working Group meet on Wednesday (Betsy Z. Russell)
Legislators on the Tax Working Group meet on Wednesday (Betsy Z. Russell)

The Legislature’s Tax Working Group is meeting again today, and first up, hearing a report from Idaho State Tax Commission Tax Policy Manager Mike Chakarun on what would happen if the current $100,000 exemption from personal property tax for business equipment were raised to $250,000, $500,000 or $1 million. At $250,000, the state would have to reimburse counties for another roughly $10.5 million in locally assessed property taxes; at $500,000, $19.7 million; and at $1 million, $30.2 million. That’s on top of the $18 million a year the state is now reimbursing counties for the cost of the current $100,000 exemption.

In addition, if the exemption were raised, the number of taxpayers paying the business personal property tax would fall from the current 5,465 to 2,616 at $250,000; 1,412 at $500,000; and just 800 at $1 million.

“If we moved it to a million dollars, then it would pretty well eliminate everybody but the big boys, as far as the personal property tax,” said Rep. Gary Collins, R-Nampa, co-chairman of the Tax working Group and the House Rev & Tax chairman. “That is correct,” Chakarun responded. “It would leave 800 taxpayers, we estimate.”

Sen. Jim Guthrie, R-McCammon, asked what the cost to the state general fund would be if the tax were entirely eliminated. According to current Tax Commission estimates, that would run $105 million to $140 million, depending on how definitions are written. The value of operating property – utility property, which is centrally rather than locally assessed – could vary and affect the totals.

You can listen live here; the panel is also scheduled to discuss income tax brackets, internet sales tax, current tax exemptions and breaks, and other issues today.

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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