BOISE, IDAHO. After receiving education budgets from the House and looking at a comprehensive budget the Idaho Senate swiftly advanced meaningful tax relief this week, passing a Tax Relief bill (H 380) by a vote of 27-8. The legislation saves Idaho taxpayers more than $160 million by cutting tax rates for individuals and businesses and provides a tax rebate of $220 million. Idahoans have faced unprecedented challenges in the past year, and providing relief to businesses and taxpayers is essential.
Senator Steve Vick, District 2-Dalton Gardens, shared that “H 380 is the largest tax cut in Idaho history and provides tax relief for every income taxpaying resident and taxpaying business in Idaho. H 380 not only reduces income tax rates, it also simplifies the tax code by reducing the number of tax brackets.”
This 2021 Tax Relief bill reduces all income tax brackets and lowers the top individual and corporate tax bracket to 6.5%, retroactive to January 1, 2021. The bill also provides Idahoans $162.9 million in ongoing tax relief funded by $110 million annually deposited from the tax relief fund and $52.9 million covered by general funds. This bill also implements a one-time sales tax/income tax rebate, returning $220 million to Idaho taxpayers by drawing $180 million from the tax relief fund and a supplementary $40 million from general funds.
Vick also added that the legislation “provides a rebate to all Idahoans. Sometimes government collects more revenue than it needs to fund its operations. H 380 returns that extra revenue to those who earned it because it’s not the government’s money.”
The bill now heads to the Governor, who is expected to sign the legislation into law.