- Associated Press - Thursday, February 2, 2017

BOISE, Idaho (AP) - The Idaho House overwhelmingly approved a $51 million tax cut plan on Thursday despite hesitation from Republican and Democratic lawmakers unhappy with the deal.

The 11 Democrats in the House were the only lawmakers to actually vote against the bill, arguing that the state should be investing its money in education and health care.

However, multiple Republicans also voiced uneasiness that the bill doesn’t address long-term tax relief for Idahoans and instead only provided a small one-time cut.

“I’ve really been torn over this, because at the heart of the matter, I believe we all need to be frugal,” said Rep. Kelley Packer, R-McCammon. “But I do think we need tax reform.”

A Senate hearing on the tax cut plan, HB67, has not yet been scheduled or promised by the chairman of the Senate Local Government and Taxation Committee.



According to the bill, the first $750 of income would be exempt from taxation, and the top income and corporate rates would be reduced from 7.4 percent to 7.2 percent

Rep. Illana Rubel, D-Boise, spoke at length that the bill was a poor choice because the state will get hit with unexpected bills if the Affordable Care Act is repealed without a replacement. She added that the money could be better spent on higher education or attracting and retaining workers in Idaho.

House Majority Leader Mike Moyle, who is backing the bill, defended his proposal as good tax policy and urged lawmakers to give a little cash back to Idahoans during a budget surplus.

Idaho’s top individual income tax and corporate income tax rates are higher than Montana’s and Utah’s. Wyoming and Nevada do not tax in those categories.

“I will vote for this bill, but I hope this is just a starting point,” said Rep. Karey Hanks, R-St. Anthony.

For the past several years, Idaho lawmakers have voiced desire to reform the state’s tax structure and offer relief to citizens that’s part of a sustainable long-term plan. Legislative work groups have spent hundreds of hours studying the issue, but in the end, reform efforts have failed to take hold.

Gov. C.L. “Butch” Otter boasted during his annual State of the State address that he had approved roughly $1 billion in tax relief throughout his 11-year tenure, but that total was mostly reliant on the state’s grocery tax credit - which offers just a modest kickback to Idahoans.

Instead, smaller relief measures tend to succeed at securing legislative approval. Getting a tax cut plan through the House is the easiest step.

Traditionally, the Senate has been a much stricter critic of tax policies and has not been afraid to revamp them, much to the House’s chagrin.

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