
The Idaho Legislature is discussing whether or not they should abolish the business personal property tax. This would severely cut the budgets of Idaho counties and cities, and other government entities that rely on the state to transfer this money to them. The Legislature says they will now permit local options sales taxes, and this will make up for the cuts. Many rural counties in Idaho do not have the businesses to provide people places to pay sales taxes, and will be unable to replenish these monies.
How you feel about this is up to you. If you would like to write to your Idaho state legislators about this, you can find their contact info here. Just so you know, the email capabilities of that site seem to be down today, January 22, 2013. I will be sending my local legislators a letter in the mail.
If you agree that the Legislature should not do this, here is a sample letter for you below:
Please do not abolish the personal property tax for Idaho businesses. This is a very bad idea, and breaks the trust between the state of Idaho and the other, smaller governments contained within it, that rely on the state to transfer the money they need to operate.
Historically, the Idaho Legislature has been unsuccessful in replacing lost taxes for the entities who received them. Property taxes were cut in 2007, and the remaining monies placed in the general fund. Schools were told that sales taxes would make up for the lost money, but the recession came, and sales taxes dropped. Now we are told that the personal property tax money can be made up to the cities and counties of Idaho, through local options sales taxes.
For counties without many businesses, such as Clark County whose largest businesses are a gas station and a cafe, this is a farce. Even for larger counties, such as Bonneville County, I do not believe that a sales tax would make up for the millions of dollars lost. Even if it did, it forces the county budget to be reliant on the economy. This is not a safe bet, as we have seen with the schools.
Besides, what the legislature has in mind is not really an abolishing of a tax, but a tax shift. This doesn’t make the taxes go away – counties still need to pay for essential services – but forces a different group of people to pay the taxes.
Until the legislature can come up with a fail-safe plan for replacing the lost tax money, one that does not include relying on a fickle economy and voters being willing and able to tax themselves more, the personal property tax should stay.