Idaho

In 2001, with the budget still showing a surplus of $350 million, the legislature cut income tax rates for both individuals and corporations. The revised progressive personal income tax schedule has eight bands, bands ranging from 1.6% (down from 1.9% ) for taxable income up to $1,085 (up from $1,000) to 7.8% (down from 8.1%) on taxable income over $21,730 (up from $20,000). For a family of four, standard deductions total $14,900. Idaho's flat tax on corporate income was lowered from 8% to 7.6%, with a minimum tax of $20, and a $10 charge on each tax return. The legislature raised the general sales tax rate temporarily from 5% to 6.5% from 1 May 2003 to 20 June 2005. Prescription drugs are exempted from the sales tax. Groceries are not exempted, but the state extends a grocery tax credit, which was raised by $5 a person beginning in 2003/04 (at an estimated cost in lost revenue of $5.5 million). The state also levies selective sales taxes (excises) on alcoholic beverages (the state controls all sales), cigarettes (increased to 62¢ per pack in 2003/04) and tobacco products, motor fuels, insurance premiums, hotel/motel rooms and campgrounds, and electric utilities. Idaho's estate tax, which is set equal the federal estate tax credit, is scheduled to be gradually eliminated in tandem with the elimination of the federal estate tax by 2007 absent positive action by the Idaho government to prevent it. The revenue loss from the phasing out of the state estate tax is estimated at $2 million a year in 2002/03, 2003/04, and 2006/07. Idaho has no gift tax. Ores produced are subject to a severance tax, and oil and gas to production taxes. Other state taxes include various kinds of license fees. There is no state property tax. Local property taxes are the only major source of local revenue, averaging 1.7% in urban areas, and 1.2% for rural areas. In 2003, a Property Tax Reduction program (administered by the state but according to information from county assessors) offered reduced assessments for older and/or disabled people with 2002 incomes below $21,290.

Total state government tax collections in 2002 were $2.271 billion, equaling $1,693 per capita. Individual income taxes accounted for 37%; the general sales tax for 26.1%; excise taxes for 10.5%; license fees for 9.8%; corporate income taxes for 3.3%; estate taxes for 0.42%; and severance taxes 0.16%.

In 2003, total state and local taxes in Idaho as a percent of income were reported as 10.2%, the 11th highest in the US.

The following table from the US Census Bureau provides a summary of taxes collected by the state in 2002.