• Additional Analysis: Impacts of House Bill 463 Including the Pass-Through Deduction (199A) Provision

    February 21, 2018

    Note: The Idaho Center for Fiscal Policy previously released analysis of House Bill 463. As explained in that brief, the analysis did not include the impacts of business tax provisions. The Center can now provide an analysis of the proposal that accounts for the impact of the pass-through deduction specifically. Other business provisions remain outside of the scope of this analysis. The impact of a proposed reduction in the state corporate rate is excluded from this analysis. That impact would primarily flow to the top earners. The Center has also simplified this analysis by providing all charts with the same income ranges across different family sizes.

  • Exploring Working Family Tax Credit Options in Idaho

    February 16, 2018

    Idahoans believe that everyone should pay their fair share. But the passage of the federal Tax Cuts and Jobs Act in December 2017 raised concerns about potential negative impacts on Idaho families with children. If Idaho chooses to update its tax code to align fully with the federal changes (a policy choice called ‘conformity’), more than 71 percent of Idaho families with 1 to 2 dependents will see a state tax increase and nearly 83 percent of Idaho families with 3 or more dependents will see a state tax increase. To mitigate these negative impacts, Idaho lawmakers are considering the creation of state tax credits for working families.

  • Analysis of House Bill 463

    February 6, 2018

    House Bill 463 would make substantial changes to Idaho’s tax code, in part as a response to recent federal tax cuts. The legislation would also cut Idaho’s state income tax rates for households and corporations, changing significantly the way the income tax load is carried by residents. The proposal also includes a nonrefundable state child tax credit, although this does not offset the tax increases for some Idaho families.

  • Critical Crossings: An Economic Profile of Idaho

    January 30, 2018

    Nine years after the Great Recession upended the economy, Idaho faces multiple policy options for encouraging economic growth due to stronger revenues. After five years of shrinking economic performance between 2008 and 2012 our state now produces more in goods and services per Idahoan today than it did before the downturn ($35,000 per capita, compared with about $50,000 for the nation), even taking into account inflation and population growth. At the same time, Idaho is experiencing the lowest unemployment rates on record since 1976. By many measures, our economy is gaining steam.

    Other signs, however, suggest that these gains could come with a stronger footprint, and could be more broadly shared across communities. For example, while Idaho’s economy has generally grown, that growth has occurred at a slower rate than the nation as a whole. And while gross domestic product in the first quarter of 2017 remains strong, wages have remained stagnant during the entirety of the recovery.

  • Trends in Tuition at Idaho’s Public Colleges and Universities: Critical Context for the State’s Education Goals

    June 9, 2017

    Idahoans have long valued public higher education, recognizing its importance to the economy and social fabric of the entire state. In fact, the territorial legislature founded the University of Idaho in 1889, before Idaho was admitted as a state. Over the past three decades, there has been a departure from the state’s historic commitment to higher education, as funding from the legislature has declined relative to the costs of providing education.

    The result has been steeply rising tuition and fees, a growing debt load for many students, and higher barriers to attending college for middle- and low-income Idahoans. This is a threat to Idaho’s economy at a time when employers are demanding a more educated workforce, and when workers with a college degree command far higher salaries than those with just a high school diploma.

  • Analysis: Trump Plan Puts Greater Burden on Idaho’s Budget

    May 24, 2017

    The Trump Administration’s proposed budget, released Wednesday, would over-burden Idaho’s state budget at a time when it is still recovering from the Great Recession, according to a review by the Idaho Center for Fiscal Policy, a nonprofit, nonpartisan organization in Idaho dedicated to analyzing state fiscal issues. Drastic cuts to non-defense spending and public initiatives in the proposed budget would result in enormous cost-shifts to Idaho and make the tax code less friendly to average working families.

    “Idaho simply cannot afford to absorb the costs we would incur if a version of this budget is approved by Congress,” said Lauren Necochea, director of the Idaho Center for Fiscal Policy Center. “This proposed budget includes historically unprecedented cost-shifts to the states and unprecedented cuts to essential public services that working Idahoans rely on to make ends meet. The tax cuts for the wealthy come at a huge cost to children, seniors, Idahoans with disabilities, and community investments that benefit all of us,” Necochea continued.

  • Analysis: Proposal to Exempt Groceries from Sales Tax and Eliminate the Grocery Tax Credit

    March 27, 2017

    The Idaho Legislature is considering a proposal to exempt groceries from the sales tax and eliminate the grocery tax credit. The proposal’s fiscal impacts would all take effect in fiscal year 2019. The proposal sets forth a definition of food products: the same types and kinds of food products that are eligible for purchases with benefits provided under the federal Supplemental Nutrition Assistance Program (SNAP). The definition excludes restaurant sales of food.


    Idaho would forego $79.3 million in revenue annually from this proposal, according the most current estimate from the Legislative Services Office (LSO). This estimate includes a $26.2 million reduction in General Fund dollars to retain and increase the rate of revenue-sharing with local governments. This cost would necessitate either increases in other taxes such as income and property taxes or a reduction in services such as public and charter schools or public health and safety.

  • House Bill 67: Fiscal Analysis and Idaho’s Current Budget Context

    January 30, 2017

    The Idaho Legislature is considering a proposal that would cut top income tax and corporate tax rates. The bill will also eliminate the income tax on the first $750 of taxable household income.

    This proposal would substantially reduce Idaho’s general fund revenue. Estimates of the impact range from $51 million to $56 million.[1] A majority of general fund spending (62.7% in fiscal year 2017) supports education.

    The bill makes three main changes to Idaho’s tax system:

    1) A reduction to the individual income tax rate for the top bracket from 7.4% to 7.2%
    2) A reduction to the corporate income tax rate from 7.4% to 7.2%
    3) Elimination of the income tax on the first $750 of taxable household income

  • Investing in Public Education: Evaluating the Trajectory of Reinvestment in Idaho’s Education System

    January 16, 2017

    This report evaluates the extent to which the three funding sources for our public school system – state, federal and local – are able to provide the resources needed to achieve Idaho’s education policy goals over time. Our examination reveals three key findings in Idaho education funding:

    1. When adjusted for inflation and student growth, general fund support for public schools today is lower compared with 2008, despite efforts to rebuild funding in recent years (Figure 1).

    2. There is increased reliance on supplemental property tax levies (1) at the school district level, resulting in increasingly divergent funding levels per pupil across the state (Figures 3, 4, and 5).

    3. Despite recent gains, the state is only about halfway towards fully funding the policy improvements identified by a wide array of education stakeholders (Table 2).

  • Tobacco and Cigarette Tax Report

    December 22, 2016

    Idaho’s Tobacco and Cigarette Taxes Generate Revenue Used to Help Communities Thrive

    In order for Idaho communities to thrive, they need strong public systems such as education, programs to help at-risk youth get their lives back on track, and cancer research. Our state has long used revenue from taxes on cigarettes and other tobacco products to pay for these and the myriad of other public systems that serve as foundations for resilient, thriving communities.

    The taxes together bring in approximately $48 million a year, and comprise the fifth largest source of tax revenue for the state (around 1% of total revenue). The taxes also help deter tobacco use by discouraging consumption, particularly for growth.1

  • Understanding Fiscal Notes

    December 22, 2016

    More Accurate Price Tags on Legislation Would Enhance Responsible Fiscal Stewardship

    Every piece of legislation brought before Idaho lawmakers comes with a price tag. Called “fiscal notes,” these help legislators and the public understand how our dollars are being invested and conserved. Incorrect, incomplete, or misleading notes can lead to fiscal problems that interfere with achieving the state’s policy goals. In some cases, fiscal notes can underestimate or omit the long-term cost of a tax change. This is especially true because a tax change or new program will often increase in cost in future years.
    Effective, accountable government requires that legislation be accurately assessed for its cost and long-term impact on our state’s ability to raise revenue for our policy priorities. Idaho has a strong foundation in place to account for the reliability of fiscal notes. With further reforms, we can do even more to eliminate the threat of short-sighted choices brought on by incorrect, incomplete, or misleading fiscal notes.

  • Grocery Tax Credit FAQ’s

    December 22, 2016

    In recent years, Idaho lawmakers have debated eliminating the grocery tax credit (also known as the grocery credit), considering it along with the exemption of groceries from the sales tax. Over the last two decades, the grocery tax credit has been revised to expand its access and increase the credit value. Policymakers and the public should take into account considerations outlined in this document about the grocery tax credit and the important role of the sales tax on groceries in Idaho’s revenue and budgeting.


  • Fiscal Notes

    June 10, 2016

    More Accurate Price Tags on Legislation Would Improve Decisions about Allocating Resources The Importance of Fiscal Notes Every piece of […]

  • Education Funding Charts

    March 10, 2016

    Our collection of charts is intended to illuminate recent trends in the various funding sources for public schools: federal, state and supplemental levies. Key findings include:

    • Supplemental levies increased in real terms (adjusted for inflation and student growth) and grew relative to state funding
    • The number of districts using supplemental levies has risen
    • Federal school funding increased during the recession and then tapered off, starting in FY2013
    • Total state funding increased significantly in FY2016, but remains below FY2007 levels
    • General Fund revenue also remains below FY2007 levels, in inflation-adjusted per capita terms
  • Analysis and Considerations Related to House Bill 380

    January 28, 2016

    The Idaho Legislature is considering a proposal that would cut top income tax and corporate tax rates. The proposal would mean an income tax cut for 59% of Idaho households – with most of the benefits going to households with income levels above $99,000. The bill includes a small increase in Idaho’s grocery tax credit to some households that do not benefit from the tax rate reductions.

  • A More Responsible Tax Policy for Idaho

    January 31, 2015

    Currently, Idaho has 136 tax expenditures on the books for sales tax, corporate income tax and individual income tax. These 136 expenditures represent almost $2.4 billion that is not collected. This compares to a total state budget of $2.8 billion.

  • Rx for a Healthy Idaho

    December 14, 2014

    Twenty-eight states (including Washington, DC) have freed up revenue for important services like public education and provided access to affordable health care for nearly all their residents by closing their health coverage gaps. This move is saving them critical funds at the state and county levels.  The same could be true in Idaho, with potential savings of $173 million over the next ten years.

  • The Big Squeeze: College Students Dig Deeper as Idaho Higher Education Funding Falls

    October 1, 2014

    Idahoans have long valued public higher education, recognizing its importance to the economy and social fabric of the entire state. But over the past three decades, higher education funding from the legislature has declined relative to costs for public education. These cuts in state funding are a departure from Idaho’s historic commitment to higher education.The result has been steeply rising tuition and fees, a growing debt load for many students, and higher barriers to attending college for middle- and low-income Idahoans.

  • Six Key Facts About Idaho’s Revenue Shortage and Our Declining Economic Performance

    August 14, 2014

    Idaho has a history of hard work and pragmatic investment. But, according to a new report from the Idaho Center for Fiscal Policy, Idaho is falling behind when it comes to building for our state’s future.  Six Key Facts About Idaho’s Revenue Shortage and Our Declining Economic Performance analyzes Idaho’s tax structure and its impact on the state’s ability to fund education and other projects to expand the economy.

  • The Idaho Budget Primer

    July 14, 2014

    This is a citizens’ guide to Idaho public finance, with a particular focus on the Idaho state budget: What is it? How does it work? How does it impact me? You’ll be able to answer these questions with ease once you’ve read this clear, simplified guide to how state policy makers handle the collection and spending of a few billion dollars of our collective financial resources.

  • Idaho Public School Funding – 1980 to 2013

    January 14, 2014

    This report examines Idaho’s funding of its public schools over the past three-plus decades. It looks at the level of overall funding effort and finds a significant decline has occurred since 2000. It also looks at the role of property taxes in funding public schools in Idaho and finds a significant increase has occurred in the use of unequalized property taxes.