Bill Description: House Bill 260 would repeal the sales tax on groceries and adjust the revenue sharing formula for local governments so they don't lose any money.
Rating: +2
NOTE: Conservatives in Idaho have spent more than a decade calling on lawmakers to repeal the sales tax on groceries. Learn more about this critical policy priority at idahofreedom.org/gtr
Does it directly or indirectly create or increase any taxes, fees, or other assessments? Conversely, does it eliminate or reduce any taxes, fees, or other assessments?
House Bill 260 would create Section 63-3622H, Idaho Code, to exempt "food sold for human consumption" from sales and use taxes in Idaho. The definition of “food” would be the same as that used by the supplemental nutrition assistance program (SNAP) as it existed on January 1, 2025.
Sales tax would still be charged on "restaurant sales of food, food sold in a heated state or heated by a seller, two (2) or more food ingredients mixed or combined by a seller for a single sale, or food sold with an eating utensil provided by the seller such as a plate, knife, fork, spoon, glass, cup, napkin, or straw."
This exemption would save Idaho taxpayers more than $400 million annually.
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Does it violate the principle of equal protection under the law? Examples include laws that discriminate or differentiate based on age, gender, or religion or which apply laws, regulations, rules, or penalties differently based on such characteristics. Conversely, does it restore or protect the principle of equal protection under the law?
Under Section 63-3622FF, Idaho Code, purchases of food made with SNAP benefits are exempt from sales and use taxes in Idaho. Exempting all groceries (using the SNAP definition) from these taxes would allow all Idahoans (rather than only recipients of this redistributive government program) to purchase groceries without the added cost of the sales tax.
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Does it increase government spending (for objectionable purposes) or debt? Conversely, does it decrease government spending or debt?
Under Section 63-3638, Idaho Code, a portion of the money collected by the state through sales and use taxes is allocated to cities and counties. House Bill 260 would increase the percentage of revenue allocated to local governments from 11.5% to 13.2% to offset their revenue losses.
It is estimated that this change would be revenue neutral for cities and counties.
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