House GOP Fast Track Corporate Tax Cut Out of Committee

The GOP fast tracked a lopsided tax proposal out of committee Tuesday that overwhelmingly benefits profitable corporations and people with the highest incomes.

The House Revenue and Taxation Committee forwarded House Bill 436 to the full body in a party-line vote following the public hearing. Every constituent who testified spoke against the bill; only lobbyists were in favor.

Per the legislation, someone with $1 million in annual taxable income will receive an ongoing yearly tax cut of $5,000 on top of a nearly $8,000 one-time rebate. Idahoans with the most modest incomes will receive a rebate of $75. The bill also reduces the corporate income tax rate from 6.5% to 6%, matching the sales tax rate people pay for food, diapers, medicines, and other needs. 

Assistant House Democratic Leader Lauren Necochea spoke against the costly legislation in committee, and said if passed, the bill will gobble up dollars that should be used for more critical tax solutions, such as reducing property taxes or repealing the sales tax on groceries. She added that it does nothing to bolster Idaho’s working families or local economies.

“The priorities of GOP legislators are upside down when they want to send $8,000 checks to households in the top 1% and $75 to Idahoans who work for modest wages,” Necochea said. “We need more dollars in the hands of working Idahoans who power our local economies when they buy groceries, get an oil change, or have their hair cut.”

Her comments were echoed by Rep. James Ruchti, who also expressed concern that once the legislature decides to commit funds toward another income tax cut, there would be no money available to address the real needs of Idahoans.

Both said they haven’t been contacted by a single constituent asking for income tax cuts, but many have asked for repealing the grocery tax, meaningful property tax relief, well-funded schools, and sustainable infrastructure.

“It’s clear; this is not the tax bill Idahoans want. Idahoans are very clear that they want property tax solutions and a repeal of the sales tax on groceries. No one is asking for income tax or corporate tax cuts,” Ruchti said. “This year, we have the opportunity to be creative and really invest in our working families. This proposal only leaves them further behind.”

According to the Idaho State Tax Commission’s Tax Burden Study, Idaho ranks 18th for corporate taxes collected relative to state income, at 1% below the national average.