Friday, January 11, 2013

Tax dodge

Can Gov. Butch Otter seriously believe that Idahoans will welcome ditching a tax on business only to replace it with a local tax on individuals?
He has proposed eliminating the personal property tax levied on business equipment that generates $141 million annually to Idaho counties. In place of the tax, he wants the Legislature to grant counties—the beneficiaries of the business equipment taxes—the ability to levy local-option taxes. He didn’t specify what kind.
The Idaho Association of Commerce and Industry has pressured the state for years to rid businesses of the tax. To be sure, calculating the tax is a boon for accountants and a pain for businesses, but what tax isn’t?
The echoes of the brainstorming session that must have preceded the idea unveiled in the governor’s State of the State message must still be ringing off the Capitol’s marble walls. The conversation must have gone something like this: “We hate taxes so let’s get rid of one and make IACI happy. We also hate being yelled at by county commissioners who’ll have to cut budgets, so let’s offer them the chance to replace the lost revenue with local taxes if approved by voters. Voila! Deal!”
This political sleight-of-hand could result in slashed services or individuals saddled with higher taxes while businesses laugh all the way to the bank. Ordinary Idahoans should make sure they are the ones with the last heehaw on this one.

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