By ROBERT S. MERRILL
The 2013 session of the Idaho Legislature will kick off this Monday, Jan. 7, in Boise with the State of the State address by Gov. C. L. “Butch” Otter and his budget projection.
“We will have three main topics to deal with this year. One will be personal property taxes on business and industry. Another will be health care and the third will be education reform,” said Marc Gibbs, Franklin County’s representative, who lives in Grace.
A taxation fight, depending on the outcome, could impact the amount local residents have to dig out of their own pockets.
All equipment and hardware that industry and business uses across Idaho generates revenue for counties, including Franklin, through a tax on personal property. Business lobbies in the state call it a “hated” tax. Heavily industrialized counties like Caribou and Power use the monies generated by it to fund many services and call it “a lifeblood.”
There will be an effort in the Legislature to repeal this and if that happens Franklin County Assessor Jase Cundick said it will negatively impact the amount of funding all taxing entities in the county receive.
“While this would be a big help to business owners throughout the state, it creates a possible issue for taxing districts that would be losing that tax revenue or the property owners that will be paying the difference in shifted taxes,” he told The Preston Citizen.
“Businesses are taxed on items owned and used for their respective operations such as tools, non-registered vehicles, furniture and appliances, among other things. While there is some talk that replacement dollars may be provided, similar to when the agriculture exemption went into effect, there are many wondering where those dollars would come from,” he said.
“The following examples are approximate, but very close to actual amounts. Currently, for the tax year 2012, Preston City taxes on personal property $9,434,207 in value, which results in $36,789 budget dollars for its coffers. Should legislation be passed to drop the tax, the city will have to decide whether to tax property owners for the difference or make the necessary cuts to forego those tax dollars.
“This would affect not only city and county budgets, but all taxing districts in the county including schools and cemeteries. The amount of personal property that is taxed varies from district-to-district and the impact of dropping personal property from taxation rolls will create a unique change to each respective budget.
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