The special session put the wealthy and corporations ahead of normal Idaho taxpayers

Idaho Republican lawmakers did not rush to Boise on Sept. 1 to beat Reclaim Idaho to the punch by spending $410 million on education.

Reclaim Idaho’s Quality Education Act ballot measure would have invested $323.5 million.

While Democrats were persuaded to support an influx of money for schools, GOP legislators acted in order to block Reclaim Idaho’s attempt to restore some fairness to Idaho’s income tax system. And in the process, these lawmakers doubled down on a decades-long effort to benefit corporate Idaho and the investor class at your expense.

Consider the analysis the Idaho Center for Fiscal Policy released late last month — which the GOP promptly ignored:

• Tax rebates — Granted, Gov. Brad Little’s plan to divvy up $500 million in rebates was kinder to working- and middle-class households because it set a $300 minimum for individuals and $600 for couples filing jointly.
  
  But while slightly more than a third of that money will go to households in the $44,000-to-$113,000 income range, the wealthy continue to haul in cash they really don’t need. The top 5% —roughly 8,500 households — will split about $110 million of that relief.
  
  If the point of this was — as Little asserted — to help Idaho families struggling with inflation, an expanded grocery sales tax credit or a child credit would have targeted relief where it’s most needed.

• Corporate income taxes — It’s been 35 years since Idaho corporations paid the 8% rate Reclaim Idaho’s initiative would have reinstated.
  
  Two years ago, corporations paid 6.925%.
  
  The 2021 session dropped the corporate rate to 6.5%.
  
  Earlier this year, lawmakers took it down to 6%.
  
  And this month, lawmakers lowered it to 5.8% — worth about $12 million to corporate investors, 81% of whom live outside Idaho.

• Individual income taxes — Reclaim Idaho planned to impose a 10.925% tax on individuals making more than $250,000 and couples earning more than $500,000. The last time Idaho even came close to that idea was 1987, when the top rate wealthy Idahoans paid was 8.2%.
  
  Since then, that rate has been whittled down as well.
  
  Under Gov. Dirk Kempthorne, it dropped to 7.8%.
  
  Gov. C.L. “Butch” Otter brought it down to 7.4%. The top rate dropped to 6.925% in 2018.
  
  But it’s been on Little’s watch that the wealthy have truly prospered. In 2021, it was cut to 6.5%.
  
  Earlier this year, Little cut it to 6%.
  
  Now it’s pegged at a flat 5.8% — which means the Joneses will pay the same rate as the Simplots.

And there’s no question about who benefits most from this.

Of the estimated $161 million in new permanent income tax relief lawmakers just authorized, less than a quarter will be shared among 60% of Idaho wage earners.

The top 5% will collect almost $50 million.

But that $161 million is only the latest chapter of this story.

Add to it the $170 million in permanent tax cuts approved in 2021 as well as the $251 million passed in January. That’s more than a half-billion dollars removed from Idaho’s revenue stream every year.

Sure, the state is sitting on comfortable budget reserves. But it also has a terrible habit of passing ambitious tax cuts as if the economic good times will never end.

An imminent recession has New York and California lowering revenue estimates. Oregon’s state economists are flashing the caution signs about an impending slowdown in revenues.

So what’s the more likely outcome if Idaho’s economy encounters chillier winds?

The first casualty is going to be any effort to take the sting out of rising property taxes homeowners are enduring — or doing something about the sales taxes collected on food purchases.

Then what?

Will they restore the lost tax rates to prop up sagging budgets?

Or will the money they promised to spend on education just last week begin to vanish?

Do you need to ask? — M.T.

Marty Trillhaase is the opinion page editor of the Lewiston Tribune, where this editorial originally appeared.