Idaho's House speaker introduces property tax-cutting bill
BOISE — The third tax-cut bill of the session was introduced Tuesday, tackling property taxes.
House Speaker Mike Moyle presented the proposed bill.
State government does not set or collect property tax revenue, Moyle underscored, but rising property values in the state have come with calls to help reduce the property tax burden. Local governments — such as cities, counties and school districts — largely rely on property tax revenue.
“There’s more to do on property tax relief. This is a start to get us there,” Moyle said. “One of the concerns I’ve had as we look at property taxes is, if I had my way, we would get rid of them all the way. I don’t know how to crack that nut.”
The bill would take $50 million from the now-defunct Bond Levy Equalization program and put it in the fund that goes toward homeowner property tax relief. This would be a one-time transfer.
The Bond Levy Equalization fund, which used to go to school districts based on need to help pay off bonds and levies, had about $63 million left in it after it was no longer in use, Moyle said.
The money going to reduce homeowner property tax bills only applies to primary residences.
The bill would also add $50 million in additional funding from online sales tax revenue to help schools pay off bonds and levies.
Reducing school district reliance on bonds and levies for facility maintenance is meant to reduce property taxes.
The school facility funding is distributed to districts based on average daily student attendance. This distribution formula has drawn some scrutiny because smaller districts get smaller distributions but still face high costs to maintain and build facilities.
Other proposed tax cuts
On Monday, House Majority Leader Jason Monks, R-Meridian, proposed an increase to the grocery sales tax credit that would result in a $50 million reduction in the state’s revenue annually.
The proposal would increase the tax credit from $120 per person to $155 per person annually to account for the sales tax applied to grocery purchases.
Last week, Moyle proposed a reduction of the individual and corporate income tax rate and a tax exemption on some military pensions — which would reduce state income by about $253 million.
The bill would reduce the rate from 5.695% to 5.3%; it also eliminates the capital gains taxes on metal bullion from mining operations.
Moyle has said he hopes to reduce the revenue by around $400 million in tax cuts in total this session.