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Priority One: Give all Idahoans a raise in 2017

Priority One: Give all Idahoans a raise in 2017

by
Wayne Hoffman, IFF’s former President
December 9, 2016

Over the last five years, Gov. Butch Otter and the Legislature have raised taxes and increased the size of the state budget by a third. And it sounds like Otter is gearing up for a repeat in the 2017 session. He recently told a crowd that he has no plans to propose tax relief. Willing to listen to ideas, yes. But that’s about it. That’s not the conservative leadership Otter promised when he was first elected governor in 2006.

Otter won’t say it, so I will. Taxpayers deserve a break in 2017. It should be the Legislature’s Number One priority. If this Republican governor and Republican Legislature are deserving of the title “conservative,” tax relief is the one thing they must deliver this winter.

Related: Click here to see the 2017 Taxpayers Budget, which cuts taxes by $200 million.

To be clear, we’re entering yet another legislative session wherein come January, a sizable surplus will exist. Millions of dollars are available to either spend or return to the people to whom the money belongs. That’s where we found ourselves at the start of 2016. What did Otter and the Legislature do? They spent every penny they could. State employees got a pay raise. Their insurance cost increases were covered. Public schools and everyone else got big spending increases. You got nothing. Not even a thank you.

Very little is different today. If our Republican governor and the Republican Legislature hold the line on spending (for a change), it is well within reach to provide Idahoans with at least $200 million in tax relief, money that would go back into the pockets of hardworking Idahoans; money that would refuel the economy; money that would make a difference at the grocery checkout line, in people’s paychecks, in the ability of companies to hire and invest.

Tax relief isn’t about giving a break to the wealthy. For context, my son, who is 16 and works part-time a Boise restaurant, is well on track to being considered “wealthy” by the standards of Idaho’s tax code: Anyone who earns more than $11,000 a year finds himself in the state’s top 7.4 percent tax bracket. That bracket includes millionaires and the working poor alike. Indeed, Idaho’s top marginal tax rate remains the highest in the intermountain region.

Don’t even get me started on the grocery tax, wherein the state collects a sales tax on your grocery purchases, holds onto the cash, then gives it back to you the following year via your income taxes. That’s about $165 million that comes right out of the state’s economy, for no purpose whatsoever.

Lawmakers of late have liked to frame tax relief in terms of what such relief would mean for the state. But tax policy should, first and foremost, be about letting people keep the money they earn, not determining whether or how the government benefits.

Idaho taxpayers have done more than their share. They’ve given up their earnings to pay for the healthcare and retirement expenses of government employees. They’ve given up their income to pad the paychecks of government employees. They’ve given up more money for roads and bridges. They’ve shelled out enormous sums for public schools and other agencies. Idaho taxpayers have got nothing in return.

It’s well past time our state government provide significant, meaningful tax relief to all Idahoans. Idaho taxpayers deserve a raise, too.

Idaho Freedom Foundation
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