Bill to Boost Idaho Grocery Tax Credit by $20 Pass House | Idaho News

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By REBECCA BOONE, Associated Press

BOISE, Idaho (AP) — A bill that would increase by $20 the amount Idaho residents can recoup annually in sales taxes on groceries passed the full House on Thursday after a debate over whether it goes far enough to help people struggling with inflation.

Idaho residents under age 65 can currently get maximum annual tax credits of $100 for the money they spend on taxes on groceries. Older residents receive a slightly higher amount.

Rep. Jim Addis’ bill would increase the annual credit for those under 65 to $120 from tax returns filed in 2024, slashing state revenue by about $32 million. Addis said that for a family of four, the bill would provide tax relief on about $8,000 in grocery purchases per year.

“This is a good faith attempt to reduce the tax burden on the citizens of Idaho,” said Addis, a Republican from Coeur d’Alene.

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But Idaho is running a record budget surplus of nearly $2 billion, and opponents on both sides of the aisle have said the bill doesn’t do enough to put money back in taxpayers’ pockets as families face high rates of inflation.

Representative John Gannon, a Democrat from Boise, said current inflation in Idaho and other mountain states is around 9%.

“Idahoans need inflation relief, not $20 in two years,” Gannon said. “It is time to suspend or simply repeal this tax on groceries…I hope this body decides to take real and meaningful action.”

Rep. Ron Nate, a Republican from Rexburg, said the bill should be amended to add repeal of the state’s 6% grocery tax. He noted that none of the states surrounding Idaho tax groceries except Utah, which taxes groceries at 3%.

“That $20 tax credit is just crumbs to the amount of money that’s in state coffers,” Nate said. “It’s insulting to the families whose hard work created this surplus.”

But Rep. James Ruchti, a Democrat from Pocatello, said he would also like to see more tax relief on groceries, but reminded his colleagues that at the start of the session they voted to approve. $600 million in income tax relief, using about a third of the state surplus. He urged others to vote in favor of the bill.

“Now we’re in a position where we don’t have much more, if we’re going to do some of the things that we talked about for infrastructure and education,” he said. “I agree it’s not much…but that’s what we have.”

The bill passed the House with a 40-27 vote and is now going to the Senate.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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