‘Spud Family’ figures adjusted; increases hit families with 3 or more kids

The Associated Taxpayers of Idaho have revised their calculations of the impact of HB 463, the governor’s tax-cut bill, on the “Spud Family,” an Idaho family of four with an income of $84,901. Executive Director Miguel Legarreta said there was an error in the calculations that he presented to the House Revenue & Taxation Committee on Monday, with an earlier version of the bill plugged into the ATI’s formula. Instead of an 8.9 percent tax increase, the “Spud Family” with two children would see a 3.1 percent decrease in its Idaho income taxes under the bill, the new calculations showed. If the family had three children, it’d see a 2.4 percent increase; and if it had four children, it’d see a 9.7 percent increase.

“It was a mistake on my part,” Legarreta said; he’s supplying corrected figures to lawmakers.

The reason why the tax bill results in an increase for larger Idaho families is because the proposed non-refundable child tax credit of $130 per child is less than half the amount that would be needed to offset the loss of the personal exemption, which Congress eliminated as part of the federal tax-cut bill. At the request of Rep. John Gannon, D-Boise, legislative budget analysts calculated how high that credit would have to rise to fully offset the loss of the deduction and be revenue-neutral; it came to $287.