Idaho governor signs property tax relief bill

BOISE — Idaho Gov. Brad Little and legislative leaders stood in the driveway of a young family’s home Wednesday to sign House Bill 304, which will provide around $100 million to school facilities and property tax relief.

The home belonged to Joey and Madi Verhaegh and their 1-year-old son, Brooks.

Little highlighted that the family would see a decrease on their property tax bill this year.

“Joey is a firefighter with the Meridian Fire Department. Madi is a public school teacher,” Little said. “As a young, growing family, they want and deserve to keep more of their hard-earned dollars.”

The bill provides $50 million to a fund that is available to school districts and distributed based on average daily attendance, which can be used by the districts to pay off bonds, levies or toward facility projects if there are no bonds or levies.

HB 304 also sends another $50 million to counties to go toward a reduction in homeowners’ property taxes in owner-occupied houses.

One of the bill sponsors, Sen. Scott Grow, R-Eagle, estimated there will be a 14.6% decrease on average on the total property tax bill.

The bill is one of three tax cut bills passed this year; they include a $253 million income tax cut bill, HB 40, that also eliminated the capital gains tax on precious metal bullion and exempted some military pension income.

Because Idaho has a flat tax rate, the cut is disproportionately higher for higher earners and corporations.

Under HB 40, the middle 20% of households, earning between $55,600 and $91,800, would save around $127 on average on state income taxes, according to a report by the Idaho Center for Fiscal Policy. Households earning between $146,000 and $286,000 would see a cut of $456. 

Another bill this session put $50 million toward increasing the grocery sales tax credit to $155 a year, up from $120.

The total ongoing reduction in the state’s revenue is around $400 million from the three bills.

Asked if he was worried about the impact to state services, Little responded, “I was told that $4.6 billion ago,” citing the total number of tax cuts and rebates that have been approved since he took office in 2019.

Little said his priority to help young families also included investments in roads, water, and sewer.

“We’re trying to make it to where people can afford a house and build a house,” he said, “that’s all very, very conducive to young families, making that critical investment.”