Yesterday afternoon at its 3 pm meeting the Senate Local Government and Taxation Committee heard two bills related to sales tax. We summarized S1295 in an earlier tax bulletin. This bill proposes that the State Tax Commission be allowed to participate in discussions with other states in the Streamlined Sales Tax Project (SSTP) with the goal of collecting sales/use tax from remote sales such as internet/mail order sales. The other bill is S1381 (much like legislation proposed in previous legislative sessions) providing that the legislature conduct a review of all sales tax exemptions during any 5 year period and that any sales tax exemptions enacted after July 1, 2010 shall expire five years after, unless extended by statute. The most recent interim legislative committees having done similar studies in 2003/2004 and again in 2007. We will keep you posted on S1381 and yet another potential interim study on this matter.

LOOKING AHEAD

Although some legislative proposals have already been introduced with the purpose of incenting Idaho job growth and economic development, the most recent was H597. This bill provides taxpayers a $2,000 tax credit per new employee who, in the calendar year ending during the taxable year for which the credit is claimed, received annual earnings at an average rate of $16.83 per hour ($35,000 annual) or more. And, who during such calendar year also received employer provided accident and health plan coverage described in Section 105 of the Internal Revenue Code. H597 is awaiting a hearing in the House Revenue and Taxation Committee.

We know there are other job creation/economic incentive proposals floating around. Depending on how many of those are introduced and their potential effectiveness will determine how vigilant legislative tax committees will be. Whatever surfaces next week we will be researching, highlighting and reporting.