Gov. Butch Otter’s $200 million proposal to cut Idaho income tax rates cleared its first major legislative hurdle Wednesday.
Following a heated debate marked by failed procedural maneuvers and contentious spats on the floor, the House voted along party lines to pass House Bill 463 by a 59-11 vote.
HB 463 does several things:
- It conforms with the federal tax overhaul passed by President Trump and Congress in late 2017.
- It creates a nonrefundable Idaho child tax credit of $130.
- It reduces both the personal and corporate income tax rates by .475 percent.
Supporters say the bill cuts taxes by $200 million in The Gem State.
“This is arguably the largest tax cut in Idaho history,” said House Majority Leader Mike Moyle, who led a fiery floor debate and was nearly yelling within the chambers.
Meanwhile, skeptics say it masks the $97 million cost for Idaho to conform with the federal tax overhaul.
Minority Leader Mat Erpelding called it a “$200 million train wreck,” and several other Democrats argued that passing tax cuts removes money from the state general fund that could go towards youth literacy, K-12 public schools, higher education, mental health crisis centers or infrastructure projects for roads and bridges.
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Some of the House’s more conservative members — Rep. Ron Nate, R-Rexburg, and Rep. Heather Scott, R-Blanchard — led unsuccessful efforts to pull the different sections of the bill apart and to send it out for amendments to include a repeal of the state’s sales tax on groceries.
Both procedural moves fell well short of the mark.
For his part, Moyle wasn’t convinced other initiatives would suffer at the hands of a tax cut.
“You want to help with literacy?” Moyle asked. “Give parents some of their money back so they can help take care of this for their children. I love sending books to my grandkids.”
House Bill 463 heads next to the Senate for consideration.