Tax Commission, House GOPs disagree on taxpayers' burden

Tax Commission, House GOPs disagree on taxpayers' burden

by
Idaho Freedom Foundation staff
December 22, 2009
Idaho Freedom Foundation staff
Author Image
December 22, 2009

A new report on the burden Idaho taxpayers shoulder is at odds with studies being promoted by House Republicans calling for slashing state income taxes. An Idaho Tax Commission news release says Idaho has the lowest per capita tax burden among western states and the sixth lowest in the country. These rankings are from fiscal year 2007, the latest time for which census figures are available.

Republican State Rep. Marv Hagedorn of Meridian, one of several Idaho lawmakers calling for tax cuts, is basing his call for tax cuts on data from the Tax Foundation showing that Idahoan pay more than the average American. IdahoReporter.com reported on Tax Foundation rankings from 2008 listing Idaho’s tax burden above neighboring states and 13th highest in the U.S. The 2007 Tax Foundation rankings weren’t much different, listing Idaho 15th.

Hagedorn said he’s surprised the state commission’s report isn’t consistent with other tax studies. “It makes you wonder what the Tax Commission’s intent is,” he said. Hagedorn is waiting for a review from the Tax Commission about the plan from House Republicans to cut personal and corporate income taxes to 4.9 percent.

Alan Dornfest prepared the Tax Commission’s tax burden rankings. He isn’t familiar with the Tax Foundation’s rankings, but said factors like differing local tax rates and types of taxes can distort state-to-state comparisons. Idaho collects sales, income, and property tax. The only neighboring state to collect all three is Utah.

The Tax Commission report said based on population, Idaho’s tax burden is below all other western states. When you measure tax burden by income, Idaho’s is higher than Oregon and Colorado, but still in the bottom 10 nationally. The report says that the state’s personal and corporate income taxes are the higher than national and regional averages, but property taxes are lower.

Idaho isn’t the only state with big disparities between the Tax Commission and Tax Foundation rankings. The state commission says Wyoming had the 4th highest tax burden in FY 2007, while the Foundation ranked Wyoming 48th from 2006 to 2008.

The persistent difference in ranking how much Idaho residents pay the government gives ammunition to both sides in the debate on tax rates. For more on the competing studies, read the Idaho Tax Commission’s news release and complete FY2007 tax burden report and the Tax Foundation’s state tax burden chart.

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