Senate defies Otter on grocery tax
BOISE – Standing up to Gov. Butch Otter, the Idaho Senate voted unanimously Thursday to pass its amended version of the grocery tax credit increase, acknowledging that the governor may veto it.
“We are the legislative branch, and we have a voice in this,” declared Sen. Russ Fulcher, R-Meridian. “Yeah, it might get a veto – it may not.”
Otter’s press secretary, Jon Hanian, said Thursday, “He’ll take action when it gets to his desk.”
Earlier in the week, Otter said he still wants a means-tested credit that would cost the state about $22 million – not an across-the-board credit like the Senate-approved plan, which has an annual price of $32.6 million. “They could send it back to the amending order again, maybe,” the governor said then.
Within hours after the Senate’s unanimous vote, the House agreed by unanimous consent to concur in the Senate amendments to House Bill 81. Now, the bill as amended just needs a final House vote of approval to go to the governor’s desk.
Otter has been holding out for a targeted credit that gives a big break of up to $90 a year to the lowest-income Idahoans, then phases out as incomes rise. The amended bill raises the grocery tax credit for everyone from the current $20 a year to $40, and for seniors from $35 a year to $60.
Sen. David Langhorst, D-Boise, said the bill falls short, because Idaho should have looked at entirely eliminating the sales tax on food this year. “This could’ve been a victory celebration,” he said. “It is not targeted to the people who were identified as needing it most. … We know that this bill is headed for a veto.”
Sen. Shawn Keough, R-Sandpoint, told the Senate that she also has long backed removing the sales tax from food.
“For me the essence of this issue is about taxing something that is essential to life – without food, you can’t live.” But, she said, “We work very hard around here to come up with compromises. … This is a compromise, good senators.”
Keough said, “My goal, while I may not achieve it in the time I’m here but I hope to see in my lifetime, is for Idaho to join the majority of states that do not tax food.”
Sen. Joyce Broadsword, R-Sagle, said, “I too feel this bill doesn’t go quite far enough, but it is definitely a step in the right direction.”
“In my 15 years here I have twice been able to vote to eliminate the sales tax on food,” said Sen. Gary Schroeder, R-Moscow. “I’ve lost both times. … However, this is partway.”
The bill also makes the credit refundable for those who don’t make enough to owe income tax, and allows an option for people to donate their credit to the needy.