The Senate tax committee has voted 5-4 in favor of HB 463, the governor’s tax-cut bill that earlier passed the House in a party-line vote; the vote sends the bill to the full Senate. You can read my full story here at spokesman.com.

Here’s how the vote broke down:

Voting yes: Sens. Bayer, Hill, Rice, Vick and Patrick.

Voting no: Sens. Siddoway, Burgoyne, Nye and Johnson.

“What this is, it’s a sure thing,” said Senate President Pro-Tem Brent Hill, R-Rexburg. “It’s a $100 million dollar sure thing.” He noted that it’s already passed the House, and already has the governor’s support. “This is the last obstacle – it’s a sure thing …  to make sure that our citizens enjoy a $100 million tax cut. We can send this to the amending order and try to make it more perfect. This committee will have to weigh the risk of that, because we may go home, just like we have the last five years, with nothing.”

Sen. Grant Burgoyne, D-Boise, said, “What does HB 463 do? It raises taxes on people with three or more children in a state that is known for its large families. Why in the world would we do that? I have no idea.”

He added, “What this really is is a tax shift,” with the “top 1 percent” the big gainers. “Is that really how we’re going to grow Idaho’s economy?” he asked “I don’t think so.”

Sen. Jim Patrick, R-Twin Falls, a co-sponsor of the bill, said, “I haven’t seen any other tax proposal that I can support, and this is the only one I feel good about. And I’m not sure the majority of the Legislature can agree on anything, so if we turn this down, we’ll probably be here in April without a tax cut.”

Four people spoke at the hearing, following Hill, who presented the bill in detail and answered questions; and state Tax Commission Chairman Ken Roberts, who said the commission doesn’t take positions on tax policy, but has determined that it could implement the bill if it passes. One, Julia Page of the Idaho Orfganizoation of Resource Councils, opposed the bill; the other three, Alex LaBeau of IACI, John Watts of the Idaho Chamber Alliance; and Pam Eaton of the Idaho Retailers Association, supported it.

Siddoway stayed silent through the hearing. Asked afterward why he voted against the bill, he said, “Mostly the family deal. … I can’t imagine having a tax cut of this magnitude and families with children getting an increased tax. That’s the big part for me.” He said he also favored waiting a year to decide whether to conform to a big new federal tax break for pass-through businesses.

Senate Tax Chairman Dan Johnson, R-Lewiston, said the bill didn’t meet his standards for simple, fair and stable tax policy, and he noted that the federal break for pass-through entities – as opposed to corporations – was designed to make up a difference in their tax rates at the federal level that Idaho doesn’t have. As a result, pass-throughs will pay much lower taxes in Idaho, he said, and corporations likely will shift their corporate structure to become LLCs or S-corporations to get the bigger break – and Idaho will collect less in tax revenue.

“I don’t really know what the conformity is going to cost us,” he said. “For that reason, I am not as comfortable taking as large a bite out of the apple and trying to use that money to buy down the rates.”

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