Original Backer Of Sales Tax Has 2nd Thoughts Retired Supreme Court Justice Charles Mcdevitt Says Too Many Exemptions Have Crept Into The Code

One of the people instrumental in getting Idaho to approve a 3 percent sales tax 32 years ago thinks it’s time for some changes.

Charles McDevitt retired last week after eight years on the Idaho Supreme Court, including a stint as chief justice.

He is returning to private law practice in Boise.

At 65, McDevitt has had a long career that began in a Boise law firm and took him into the New York corporate suites of the Singer Co. and Beck Industries. He returned to Idaho, where he became a founding member of one of the state’s most prestigious law firms after time in the public defender’s office.

In 1989, he was appointed to the Idaho Supreme Court.

Now, he’s looking for something simpler and has joined former Public Utilities Commission member Joe Miller in a two-man firm.

But in the mid-1960s, McDevitt was a young Republican state representative from Ada County who had run for the Legislature with the goal of enacting a sales tax.

He and others won the battle. The Legislature passed it in 1965.

Three decades later, demands on the state treasury are outstripping its resources despite Idaho’s comparably strong economy and a tax rate bucked up to 5 percent.

So McDevitt thinks it’s time for changes in the tax that generates a third of the state’s general revenue.

He’d like to see a complete review of all the exemptions the Legislature has granted over the years - exemptions that are protecting more than half of all transactions from taxation.

“We taxed virtually everything” when the levy was originally imposed, McDevitt said. But that was in an era when services were not a major economic factor.

“I think the exemptions that have crept in shouldn’t be there,” he says now. “We clearly should take a look at taxing services, which are a significant part of our economy, with the exemptions for medical services and drugs, those things that are critical.”

McDevitt acknowledges that revamping the system won’t be easy, but then passing taxes never is popular and politicians voting that way often pay a price. The crunch could come in 1999 after the next election.

Former Gov. Robert Smylie faced that issue during the 1965 sales-tax debate when he told lawmakers, “If you have the courage to pass it, I have the courage to sign it.”

The next year, he was defeated in the Republican primary, and McDevitt thinks his approval of the sales tax was one of many factors that caused voters to send Smylie packing after 12 years as governor.

McDevitt’s eight years on the state’s highest court were not all harmony and cooperation. He calls 1991 and 1992 “a contentious period” when some lawmakers thought the Supreme Court wasn’t properly interpreting new laws for the Snake River water rights adjudication.

But during his final years on the court, he got along well with law makers, praising House Speaker Michael Simpson for helping the Supreme Court get into modern technology.

“But you get individuals from time to time who just don’t understand the process” and that the Idaho Constitution requires three separate but equal branches of government, he said. “Gov. Andrus had a similar problem for a period of time.”

“But ultimately, the Legislature has the power of the purse. That’s probably the strongest tool there is,” McDevitt said.

He was one of the people Gov. Phil Batt turned to in his search for ways to curb the explosive growth of Idaho’s prison population and avoid spending millions to build new prisons.

McDevitt offered Batt recommendations the high court received from district judges around the state over the past two years, and some showed up in the governor’s plan for action in the next legislative session.