Bill Description: House Bill 144 would exempt small sellers with less than $5,000 in annual sales from the requirement to collect sales taxes. 

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Does it increase barriers to entry into the market? Examples include occupational licensure, the minimum wage, and restrictions on home businesses. Conversely, does it remove barriers to entry into the market?

Currently, Idaho law requires all sellers, regardless of size or sales volume, to obtain a sales tax permit, collect sales taxes, and remit those taxes to the Idaho Tax Commission. 

House Bill 144 would create Section 63-3622XX, Idaho Code, to exempt sellers with less than $5,000 in annual sales from the need to collect sales taxes. This exemption would not apply to sellers of alcohol, tobacco, or vehicles, regardless of their sales volume. 

This exemption will remove a government-created obstacle for thousands of home businesses, solo entrepreneurs, artists, and others who sell small quantities of merchandise. In many cases, these merchandise sales are incidental to a primary business focused on providing services or performance art. 

The bill's statement of purpose says in 2023, the Tax Commission issued 10,701 permits for individuals who had sales of less than $5,000. It is safe to assume there were additional individuals who considered selling merchandise but chose not to due to the paperwork created by collecting, reporting, and remitting sales tax.

Exempting small sellers removes a barrier to their entry into the market. 

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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?

According to the fiscal note for House Bill 144, exempting small sellers from collecting sales taxes will save Idahoans who make purchases from small sellers more than $1.2 million dollars in taxes annually.

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