House Bill 353 — Property tax increase cap

House Bill 353 — Property tax increase cap

by
Lindsay Atkinson
January 24, 2020
Lindsay Atkinson
January 24, 2020

Bill description: HB 353 would cap local government property tax increases at 3%.

Rating: +1

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? 

In Idaho, local government taxing districts can collect property taxes as a portion of their revenue every year. The process of calculating property taxes is a complex one with many moving parts. One of those parts is the increase that taxing districts can add on to their property tax collection for the current year, compared to the prior year. 

Under Idaho law, taxing districts can raise property taxes by 3% each year, plus an additional amount for the value of new construction within their district boundaries, and the value of newly annexed property. As a result, some local governments have actually been increasing property taxes at a rate higher than 3% each year. For instance, the city of Boise has had an average property tax collection increase of 4.9% every year for each of the past seven years.

HB 353 would cap local government property tax increases at 3% by simply changing the word “plus” to “including.” Thus, new construction and annexation would not be on top of a 3% increase (“plus”), it would instead become a part of it (“including”). 

This would reduce the property tax burden on Idahoans.

(+1)

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