What the repeal of the personal property tax would mean for Idaho, part 2.
Often, tax cuts aren’t really tax cuts—they’re tax shifts. Many services in Idaho are already operating on shoestring budgets and cannot endure further cuts. When one tax is cut, local governments are forced to look elsewhere to fill budget gaps. This year’s push to eliminate the tax businesses pay on their equipment (called the personal property tax) could mean a dramatic tax shift from business—to you.
If proponents are successful in their effort to persuade the legislature to repeal Idaho’s personal property tax, it would create a massive hole in local and county budgets, totaling more than $140 million, putting local services—everything from schools and emergency services to road maintenance–at risk.
Reliance on this revenue source varies greatly across Idaho’s 44 counties. Personal property tax revenue makes up over 40% of Caribou’s entire tax revenue, to 21% in Elmore County it is 21%, while less than 2% of Teton County’s revenue comes from personal property tax receipts. Idaho municipalities also depend heavily on the revenues the personal property tax provides. 45% of the City of Plummer’s tax revenue comes from the personal property tax, as does 11% of Pocatello’s.
Of course, whether local budgets are hit 2% or 20%, already cash-strapped counties and municipalities won’t simply eliminate services–they’ll attempt to fill the hole created in their budgets by raising revenues elsewhere. Local governments don’t have many options when it comes to raising revenues, and they’ll be forced to look to property taxes.
In other words, if Idaho companies no longer have to pay their tax bill through personal property taxes, individual tax payers will have to pick up the tab. It’s a shift in taxes from corporations to individuals.
Tomorrow: How will a repeal of the personal property tax will affect school budgets?
House Education Committee begins to evaluate options of Props 1, 2 and 3 savings
Today the House Education Committee heard a presentation on the fiscal impact of the repeal of Props 1, 2 and 3. Paul Headlee, education analyst for the legislature, presented options to the committee, which will make a recommendation to the Joint Finance and Appropriations Committee on whether to put the savings from the repeal toward schools or toward other causes. Read more here.
New report demonstrates that socioeconomic inequality skews student test scores
WASHINGTON — The Stanford Graduate School of Education and the Economic Policy Institute today released a report, What do international tests really show about American student performance?, demonstrating that socioeconomic inequality among U.S. students skews international comparisons of student test scores.
According to the report, Program for International Student Assessment (PISA) scores in reading and math are low, on average, for U.S. students partly because a disproportionately greater share of U.S. students comes from disadvantaged social class groups. The performance of students from these groups is relatively low in all countries.
