Testimony: ‘Barely reaches those in need,’ ‘Tremendous opportunity,’ ‘Many Idaho families will see increase’

Here’s more of this morning’s testimony on HB 463, the tax-cut bill:

Julia Page, a board member of the Idaho Organization of Resource Councils, spoke against the bill. “It uses the leverage of the must-pass conformity bill to introduce several tax cuts that we believe are more appropriately discussed on their own merits in a separate bill,” she said. “We want to prioritize ending the sales tax on food. This bill is using an unanticipated revenue windfall for a huge income tax break that barely reaches those in need. Every day, families of all incomes have to pay 6 percent tax on the food that they buy. … The sales tax on food is a regressive, unfair tax that hits disproportionately those who are least able to handle it. It is a shaky foundation on which to build the Idaho budget. We can do better.”

John Watts of the Idaho Chamber Alliance said it’s hard to recruit businesses to Idaho because the state’s income tax rates are higher than other states. “What they see is 7.4,” he said. They could instead see a rate around 6.9 percent, he said. “That’s a tremendous difference. It gives us a tremendous opportunity.” He said, “Now, the chambers of commerce would love to see us go down to a 5 percent flat tax. … But this proposal is one of the biggest and most productive steps that we’ve seen in that direction in quite some time.”

Miguel Legarreta of the Associated Taxpayers of Idaho said his group calculated the impact of the bill on an average Idaho family. It found that while the bill would decrease the tax-increase impact of the federal changes on the state income taxes that Idaho families pay, the average family still would see a tax increase on its state income tax returns. “Many Idaho families will see an increase in their Idaho-based taxes,” Legaretta said. Overall, between the federal tax cuts and the changes to Idaho’s taxes, the ATI’s typical “Spud Family” would see a net tax cut of about $1,300, he said. You can see his updated data here .