BOISE — Idaho lawmakers on Friday introduced a last-minute tax cut proposal designed to provide more relief to Idaho’s families after passing a much larger tax cut deal.
Earlier this year, Idaho lawmakers passed a $200 million tax cut that critics argued was flawed because families with three or more children were likely to end up paying more taxes.
To ease that concern, the House Revenue and Taxation Committee on Friday introduced a proposal to create a $205 Idaho child tax credit.
“It’s a step in the right direction. Would I like it to be higher? I think obviously everybody would,” said House Majority Leader Mike Moyle, a Republican from Star who is also the bill’s sponsor. “It gets us closer to keeping those families whole, but it also is taking a prudent approach.”
The original $200 million plan — backed by legislative leadership and Gov. C.L. “Butch” Otter — had only allocated a $130 Idaho child tax credit. It also reduces Idaho’s personal and corporate income tax rates.
The child tax credit was deemed necessary because of the recent federal tax overhaul signed into law by President Donald Trump.
That’s because the federal law removed the personal exemption for dependents and the federal child tax credit was doubled from $1,000 to $2,000. However, Idaho’s code doesn’t currently have an Idaho child tax credit.
In order to offer more relief to families, state lawmakers originally passed a $130 child tax credit but even supporters of the bill said it wasn’t enough.
Bumping the credit to $205 will cost the state’s general fund an estimated $25 million a year.
“This should pick up just about all if not all of the concern on the larger families,” Moyle said Friday.
Rep. Ron Nate, a Republican from Rexburg, attempted to tweak Moyle’s proposal by increasing the credit to $280 — an amount some said would truly offset the costs estimated to hit Idaho’s large families.
However, Moyle angrily described Nate’s suggestion as a “hostile amendment” and argued the $205 amount had already been negotiated by legislative leaders.
Nate’s motion ultimately failed, and the panel agreed to introduce Moyle’s bill on a voice vote with no audible opposition.
The bill must now clear the House and Senate before lawmakers hope to adjourn by March 23.