How do Idahoans feel about taxes? Our survey shows they want at least one tax repealed
Idahoans mostly support how state leaders are spending their tax money, according to a new poll commissioned by the Idaho Statesman.
But they strongly oppose one tax in particular. Republicans, Democrats and independents overwhelmingly said they believe Idaho’s grocery tax should be repealed.
The Statesman/SurveyUSA poll asked 550 Idaho residents to share their thoughts on tax policy, including how the state should spend its surplus tax revenue and whether local governments should be allowed to levy local sales taxes to fund infrastructure. A majority supported the latter.
The tax policy polling results were part of a statewide poll on several contentious issues in Idaho. Results on questions related to the 2020 election, abortion, marijuana, LGBTQ rights and other topics are being released throughout the week at IdahoStatesman.com. The poll was conducted Oct. 17-20 online and by phone, with the pool of adults surveyed weighted to U.S. Census targets for gender, age, race, education and home ownership.
Grocery tax widely opposed
Food purchasers in Idaho pay a 6% sales tax. Idaho is one of 13 states that have grocery taxes, the Statesman previously reported. The state government attempts to offset the burden with a grocery tax credit, which can be claimed each year when income taxpayers file their returns.
In total, 68% of respondents favored repeal, while 23% said it should continue and 9% said they aren’t sure.
Kristen Johnson, 77, of Pocatello, favors repealing the grocery tax, although she’d prefer a policy resembling a partial repeal that maintains taxes on things like candy and soda. But Idahoans, especially those facing food insecurity, shouldn’t have to pay tax on a can of green beans, a loaf of bread, a pound of butter or a gallon of milk, Johnson said in a phone interview with the Statesman.
“The meat and potatoes kinds of things should not be taxed,” she said. “That’s just another financial burden on people.”
Democrats and a small group of conservative Republicans in the Idaho House recently have pushed to repeal the grocery tax. Proposals from House Assistant Minority Leader Lauren Necochea, D-Boise, and Rep. Ron Nate, R-Rexburg, were introduced last legislative session but did not get a hearing.
“Democrats join a strong majority of Idahoans in supporting a repeal of the sales tax on food,” Necochea, Idaho Democratic Party chair, told the Statesman by email. “But the only revenue cut Republican lawmakers are willing to make is income tax cuts tilted to the people and corporations who need them the least — a move favored by lobbyists.”
Madison Hardy, spokesperson for Idaho Gov. Brad Little, touted a recent increase in the grocery tax credit in a statement responding to the survey data. This year, the state boosted the credit from $100 to $120 for each individual and $120 to $140 for seniors.
An analysis this year by the Idaho Center for Fiscal Policy found that a minimum $160 grocery tax credit would be more realistic. That would cover taxes paid on $888 worth of groceries per month for a family of four.
“It doesn’t cover anywhere near what people with large families pay,” Johnson said. “I just think it’s a joke.”
Keep spending on education, tax cuts, infrastructure, Idahoans say
Aside from the grocery tax, Idahoans largely agree with the state’s top elected leaders’ spending priorities, the Statesman survey showed.
Over the previous two fiscal years, the state has raked in $900 million and $1.4 billion tax revenue surpluses. The Statesman survey asked how this money should be spent.
Respondents said Idaho should spend on education, income tax cuts and infrastructure, mirroring Little’s first-term priorities — and his promises for a second term as he seeks reelection.
Twenty-seven percent said they wanted increased spending on education, 22% said income tax cuts and 20% said infrastructure. Another 15% said Idaho should pursue property tax reform. And just 4% said the state should bolster its rainy-day funds. Seven percent said they favor something else and 6% said they’re not sure.
Among Republicans, income tax cuts was the most popular answer (27%), followed by education spending (23%), infrastructure investments (20%) and property tax relief (17%). Democrats far and away favored education (42%), while independents slightly favored infrastructure (27%) over education (25%).
“It is reassuring yet not surprising to see the governor’s top priorities and achievements — tax relief, education investments, and infrastructure improvements — are widely supported by Idahoans,” Hardy, Little’s spokesperson, said by email.
The National Education Association’s most recent rankings for per-pupil education spending placed Idaho 51st, last in the country. That’s why Johnson — an independent who identifies as a political moderate — said the state’s surplus should be directed to public schools.
“I am appalled at the pittance that they pay per student for education,” she said. “I don’t understand why the Legislature doesn’t spend more money on education.”
The Legislature has directed more funding to education in recent years. School funding has increased 57% since fiscal year 2018, according to the governor’s office. Most recently, Little called a special session of the Legislature to allocate another $410 million to public schools and workforce development programs. It’s up to lawmakers next legislative session whether to spend most of the money.
“I’m encouraged to see that we’ve taken serious action on the issues that Idahoans say they value most according to this poll,” House Speaker Scott Bedke, R-Oakley, said by email. Bedke is running for lieutenant governor.
“I will continue to work on any and all effective ways to reduce the tax burden of hard-working Idahoans and continue successful investments in both education and our future infrastructure needs,” he said.
Idahoans support local-option tax
Idahoans also favor local-option sales taxes, according to the new data, a policy that state leaders have denied to most municipalities.
The survey asked whether local governments should be allowed to ask their voters to approve additional sales taxes to fund local needs, such as mass transit, affordable housing and jails.
A slight majority (52%) said local governments should have that option, while one in three disagreed and 15% said they’re not sure.
Democrats were much more likely to favor the policy — 71% responded positively. But Republicans leaned favorably as well, with 47% supporting local governments’ ability to levy local-option taxes and 42% opposed.
A majority of independents also supported the policy, while a quarter disagreed and another quarter said they were not sure.
Only resort cities with fewer than 10,000 people can levy local-option taxes under state law. Local leaders for years have pushed lawmakers to expand eligibility, to no avail.
“We’ve been recommending local-option tax as a way to relieve property taxes for residents for a while now,” Kelley Packer, executive director for the Association of Idaho Cities, said by phone. “It’s nice to see that others recognize that that could be a potential solution for the infrastructure needs at the local level.”
Just 19 Idaho cities qualify for the tax. Typically, local-option taxes are levied on “tourist items,” Packer said, such as hotel rooms, alcohol and restaurant food. Local governments seeking to levy a tax must first gain approval from their voters, after specifying what items they’ll tax.
“They try to use it to keep the property tax burden on the locals that are there year-round at a lower level,” Packer said.
The city of Ketchum, for example, levies local taxes on retail sales, construction materials, by-the-drink liquor and hotel bookings, all of which raised nearly $3.7 million last fiscal year, the Idaho Mountain Express reported. Earlier this year, city officials tried to increase local-option tax rates to fund hundreds of affordable housing units, to meet soaring demand for local housing. Voters rejected the proposal.
But voters usually view local-option taxes more favorably than their local government taking on debt to fund infrastructure, Packer said. That’s because the local-option tax primarily places the burden on visitors, who use local services.
“They’d rather see everyone that comes in, especially tourists and out-of-staters, pay their share of the burden that’s put on the infrastructure in that area,” she said.
