2001 Legislation
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HOUSE BILL NO. 158 – Income tax, rebate, reduction

HOUSE BILL NO. 158

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H0158...............................................by REVENUE AND TAXATION
INCOME TAX - Amends, repeals and adds to existing law to reduce the
individual income tax rates for individuals; to provide for rebates of
10.6% of the 1999 income tax paid by individuals, subject to a $25.00
minimum and $25,000 maximum; to increase the grocery tax credit for
individuals; to reduce the corporate income tax rate and franchise tax; to
provide for an increase in deduction for capital gains; to provide for a
new employee income tax credit; to provide income tax credits for research
expenditures and creation of new jobs; to change the child care deduction
to a credit equal to one-half the federal credit; and to permanently
increase credit for caring for a dependent over 65 years of age or caring
for a person who is developmentally disabled from $100 to $500.
                                                                        
02/06    House intro - 1st rdg - to printing
02/07    Rpt prt - to Rev/Tax

Bill Text


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-sixth Legislature                  First Regular Session - 2001
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 158
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO INCOME TAX RELIEF; AMENDING SECTION 63-3024, IDAHO CODE,  TO  PRO-
  3        VIDE FOR A REDUCTION IN RATES OF ONE-TENTH OF ONE PERCENT FOR TAXABLE YEAR
  4        2001 AND TO PROVIDE FOR A REDUCTION IN RATES OF FOUR-TENTHS OF ONE PERCENT
  5        FOR TAXABLE YEAR 2002 AND THEREAFTER; AMENDING CHAPTER 30, TITLE 63, IDAHO
  6        CODE,  BY  THE ADDITION OF A NEW SECTION 63-3081, IDAHO CODE, TO PROVIDE A
  7        REBATE OF INCOME TAXES PAID BY INDIVIDUALS FOR TAXABLE YEARS BEGINNING  IN
  8        1999,  TO  DETERMINE  THE  RATE  OF THE REBATE, TO SET MAXIMUM AND MINIMUM
  9        AMOUNTS, TO PROVIDE PROCEDURES, TO APPROPRIATE  MONEYS  AND  TO  AUTHORIZE
 10        CONTRACTS;  REPEALING  SECTION  63-3022D,  IDAHO  CODE;  AMENDING  SECTION
 11        63-3022E,  IDAHO CODE, TO INCREASE THE DEDUCTION FOR DEPENDENTS SIXTY-FIVE
 12        YEARS OF AGE OR OLDER OR PERSONS WITH DEVELOPMENTAL DISABILITIES FROM  ONE
 13        THOUSAND  DOLLARS  TO  FIVE  THOUSAND  DOLLARS; AMENDING SECTION 63-3022H,
 14        IDAHO CODE, TO INCREASE THE DEDUCTION ALLOWED FOR QUALIFIED CAPITAL  GAINS
 15        AND  TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 63-3024A, IDAHO CODE,
 16        TO INCREASE THE INCOME TAX CREDIT FOR SALES TAXES PAID BY INDIVIDUALS  AND
 17        TO  MAKE  TECHNICAL  CORRECTIONS; AMENDING SECTION 63-3025, IDAHO CODE, TO
 18        REDUCE THE CORPORATE INCOME TAX RATE FROM EIGHT TO SEVEN AND  EIGHT-TENTHS
 19        PERCENT  FOR  TAXABLE  YEAR  2001 AND TO SEVEN AND FIVE-TENTHS PERCENT FOR
 20        TAXABLE YEAR 2002 AND THEREAFTER; AMENDING SECTION 63-3025A,  IDAHO  CODE,
 21        TO  REDUCE THE CORPORATE FRANCHISE TAX RATE FROM EIGHT PERCENT TO THE RATE
 22        OF THE CORPORATE INCOME TAX AND TO MAKE  TECHNICAL  CORRECTIONS;  AMENDING
 23        SECTION  63-3025D,  IDAHO  CODE,  TO  INCREASE  THE PAYMENT FOR DEPENDENTS
 24        SIXTY-FIVE YEARS OF AGE OR OLDER OR PERSONS WITH  DEVELOPMENTAL  DISABILI-
 25        TIES  FROM ONE HUNDRED DOLLARS TO FIVE HUNDRED DOLLARS AND TO MAKE A TECH-
 26        NICAL CORRECTION; AMENDING SECTIONS 63-3029E AND 63-3029F, IDAHO CODE,  TO
 27        EXPAND  THE  NEW JOBS CREDIT BY REMOVING THE LIMITATION OF QUALIFYING TAX-
 28        PAYERS  TO  REVENUE-PRODUCING  ENTERPRISE  CREATING  VALUE-ADDED   NATURAL
 29        RESOURCE  PRODUCTS;   AMENDING  CHAPTER  30,  TITLE 63, IDAHO CODE, BY THE
 30        ADDITION OF A NEW SECTION 63-3029G, IDAHO CODE, TO PROVIDE AN  INCOME  TAX
 31        CREDIT  FOR CERTAIN EXPENDITURES RELATING TO RESEARCH AND DEVELOPMENT CON-
 32        DUCTED IN IDAHO, TO PROVIDE A SUNSET, TO PROVIDE  A  CARRYOVER  OF  UNUSED
 33        CREDITS,  TO  PROVIDE DEFINITIONS AND TO PROVIDE PROCEDURES; AMENDING SEC-
 34        TION 63-3029H, IDAHO CODE, TO REDESIGNATE THE  SECTION;  AMENDING  CHAPTER
 35        30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3029H, IDAHO
 36        CODE,  TO  PROVIDE A CREDIT FOR EXPENSES FOR HOUSEHOLD AND DEPENDENT CARE;
 37        REPEALING SECTIONS 63-3029E AND 63-3029F, IDAHO CODE; AMENDING CHAPTER 30,
 38        TITLE 63, IDAHO CODE, BY THE ADDITION OF A  NEW  SECTION  63-3029E,  IDAHO
 39        CODE,  TO  PROVIDE DEFINITIONS AND CONSTRUCTION OF TERMS; AMENDING CHAPTER
 40        30, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 63-3029F, IDAHO
 41        CODE, TO PROVIDE SPECIAL CREDITS TO THE INCOME TAX FOR NEW  EMPLOYEES  FOR
 42        AN  ENTERPRISE  THAT  PRODUCES, ASSEMBLES, FABRICATES OR PROCESSES NATURAL
 43        RESOURCE PRODUCTS; PROVIDING FOR NONSEVERABILITY OF CERTAIN PROVISIONS  OF
 44        THIS  ACT;  DECLARING  AN EMERGENCY, PROVIDING RETROACTIVE APPLICATION FOR
 45        CERTAIN PROVISIONS OF THIS ACT AND PROVIDING EFFECTIVE DATES.
                                                                        
                                           2
                                                                        
  1    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
  2        SECTION 1.  That Section 63-3024, Idaho Code, be, and the same  is  hereby
  3    amended to read as follows:
                                                                        
  4        63-3024.  INDIVIDUALS' TAX AND TAX ON ESTATES AND TRUSTS. For taxable year
  5    20001,  a  tax  measured by Idaho taxable income as defined in this chapter is
  6    hereby imposed upon every individual, trust, or estate required by this  chap-
  7    ter to file a return.
  8        (a)  (i)  The  tax  imposed  upon individuals, trusts and estates shall be
  9    computed at the following rates:
 10    When Idaho taxable income is:    The rate is:
 11    Less than $1,000                 One and nine-tenths percent (1.9%)
 12    $1,000 but less than $2,000      $19, plus  three and nine-tenths
 13                                     percent (3.9%) of the amount over $1,000
 14    $2,000 but less than $3,000      $58, plus four and  four-tenths
 15                                     percent (4.4%) of the amount over $2,000
 16    $3,000 but less than $4,000      $102, plus five and  four-tenths
 17                                     percent (5.4%) of the amount over $3,000
 18    $4,000 but less than $5,000      $156, plus six and  four-tenths
 19                                     percent (6.4%) of the amount over $4,000
 20    $5,000 but less than $7,500      $220, plus seven and  four-tenths
 21                                     percent (7.4%) of the amount over $5,000
 22    $7,500 but less than $20,000     $405, plus seven and seven-tenths
 23                                     percent (7.7%) of the amount over $7,500
 24    Over $20,000                     $1,367.50, plus eight and one-tenth
 25                                     percent (8.1%) of the amount over $20,000
 26        (ii) For taxable year 20012 and each taxable year thereafter, a  tax  mea-
 27    sured  by  Idaho  taxable  income as defined in this chapter is hereby imposed
 28    upon every individual, trust, or estate required by this  chapter  to  file  a
 29    return.
 30    The  tax imposed upon individuals, trusts and estates shall be computed at the
 31    following rates:
 32    When Idaho taxable income is:    The rate is:
 33    Less than $1,000                 Two percent (2.0%)
 34    $1,000 but less than $2,000      $20, plus four percent (4.0%)
 35                                     of the amount over $1,000
 36    $2,000 but less than $3,000      $60, plus four and one-half percent
 37                                     (4.5%) of the amount over $2,000
 38    $3,000 but less than $4,000      $105, plus five and one-half percent
 39                                     (5.5%) of the amount over $3,000
 40    $4,000 but less than $5,000      $160, plus six and one-half percent
 41                                     (6.5%) of the amount over $4,000
 42    $5,000 but less than $7,500      $225, plus seven and one-half percent
 43                                     (7.5%) of the amount over $5,000
 44    $7,500 but less than $20,000     $412.50, plus seven and eight-tenths percent
 45                                     (7.8%) of the amount over $7,500
 46    Over $20,000                     $1,387.50, plus eight and two-tenths percent
 47                                     (8.2%) of the amount over $20,000
 48    Less than $1,000                 One and five-tenths percent (1.5%)
 49    $1,000 but less than $2,000      $15, plus three and five-tenths percent
 50                                     (3.5%) of the amount over $1,000
 51    $2,000 but less than $3,000      $50, plus four percent
 52                                     (4.0%) of the amount over $2,000
 53    $3,000 but less than $4,000      $90, plus five percent
                                                                        
                                           3
                                                                        
  1                                     (5.0%) of the amount over $3,000
  2    $4,000 but less than $5,000      $140, plus six percent
  3                                     (6.0%) of the amount over $4,000
  4    $5,000 but less than $7,500      $200, plus seven percent
  5                                     (7.0%) of the amount over $5,000
  6    $7,500 but less than $20,000     $375, plus seven and three-tenths percent
  7                                     (7.3%) of the amount over $7,500
  8    Over $20,000                     $1,287.50, plus seven and seven-tenths percent
  9                                     (7.7%) of the amount over $20,000
 10        For taxable year 2000 and each year thereafter, the state  tax  commission
 11    shall  prescribe  a factor which shall be used to compute the Idaho income tax
 12    brackets provided in  subsections (a)(i) and (a)(ii) of this section. The fac-
 13    tor shall provide an adjustment to the Idaho tax brackets  so  that  inflation
 14    will not result in a tax increase. The Idaho tax brackets shall be adjusted as
 15    follows:  multiply  the  bracket amounts by the percentage (the consumer price
 16    index for the calendar year immediately preceding the calendar year  to  which
 17    the  adjusted brackets will apply divided by the consumer price index for cal-
 18    endar year 1998). For the purpose of  this  computation,  the  consumer  price
 19    index  for  any calendar year is the average of the consumer price index as of
 20    the close of the twelve (12) month period for the immediately preceding calen-
 21    dar year as adopted by the state tax commission. This adoption shall be exempt
 22    from the provisions of chapter 52, title 67, Idaho Code.  The  consumer  price
 23    index  shall  mean  the consumer price index for all U.S. urban consumers pub-
 24    lished by the United States department of  labor.  The  state  tax  commission
 25    shall  annually  include the factor as provided in this subsection to multiply
 26    against Idaho taxable income in the brackets above to arrive  at  that  year's
 27    taxable income for tax bracket purposes.
 28        (b)  In  case  a joint return is filed by husband and wife pursuant to the
 29    provisions of section 63-3031, Idaho Code, the tax  imposed  by  this  section
 30    shall  be twice the tax which would be imposed on one-half (1/2) of the aggre-
 31    gate Idaho taxable income. For the purposes of this section,  a  return  of  a
 32    surviving spouse, as defined in section 2(a) of the Internal Revenue Code, and
 33    a  head of household, as defined in section 2(b) of the Internal Revenue Code,
 34    shall be treated as a joint return and the tax imposed shall be twice the  tax
 35    which would be imposed on one-half (1/2) of the Idaho taxable income.
 36        (c)  The  state  tax commission shall compute and publish Idaho income tax
 37    liability for taxpayers at the midpoint  of  each  bracket  of  Idaho  taxable
 38    income  in  fifty  dollar  ($50.00) steps to fifty thousand dollars ($50,000),
 39    rounding such calculations to the  nearest  dollar.  Taxpayers  having  income
 40    within  such brackets shall file returns based upon and pay taxes according to
 41    the schedule thus established. The state tax commission shall promulgate rules
 42    defining the conditions upon which such returns shall be filed.
                                                                        
 43        SECTION 2.  That Chapter 30, Title 63, Idaho Code, be,  and  the  same  is
 44    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 45    ignated as Section 63-3081, Idaho Code, and to read as follows:
                                                                        
 46        63-3081.  REBATE OF INCOME TAX. (1) Subject to  the  limitations  of  this
 47    section,  in  regard to each individual income tax return required to be filed
 48    pursuant to section  63-3030, Idaho Code, and that is actually  filed,  for  a
 49    twelve  (12)  month taxable year beginning in 1999 for which tax is imposed by
 50    section 63-3024, Idaho Code, on at least one dollar ($1.00) of  Idaho  taxable
 51    income,  the  state  tax  commission shall, on a one-time basis, rebate to the
 52    taxpayer named on the return the amount specified in subsection  (2)  of  this
 53    section.  In the case of a joint return, the rebate shall be paid to both tax-
                                                                        
                                           4
                                                                        
  1    payers jointly.
  2        (2)  (a)  The rebate provided by subsection (1) of this section  shall  be
  3        ten  and  six-tenths  percent  (10.6%) of the amount of tax computed under
  4        section 63-3024, Idaho Code, reduced by credits provided by:
  5             (i)   Section 63-3029, Idaho Code, relating to taxes paid to  another
  6             state;
  7             (ii)  Sections 63-3029A and 63-3029C, Idaho Code, relating to certain
  8             charitable contributions;
  9             (iii) Section 63-3029B, Idaho Code, relating to capital investments;
 10             (iv)  Section  63-3029D,  Idaho Code, relating to qualified equipment
 11             utilizing postconsumer waste or postindustrial waste.
 12        (b)  When the amount of a rebate payable under subsection (2)(a)  of  this
 13        section  is  less  than  twenty-five  dollars  ($25.00), the amount of the
 14        rebate shall be twenty-five dollars ($25.00). When the amount of a  rebate
 15        payable  under subsection (2)(a) of this section is more than two thousand
 16        five hundred dollars ($2,500), the amount of the rebate shall be two thou-
 17        sand five hundred dollars ($2,500). In the case of married taxpayers  fil-
 18        ing  separate  returns,  only  one  (1) minimum or maximum rebate shall be
 19        paid.
 20        (3)  No rebate shall be paid pursuant to  this  section  in  regard  to  a
 21    return  described in subsection (1) of this section if the return is not filed
 22    within three (3) years of the original due date of the return, without  regard
 23    to  extensions.  In  the  event  that  the amount of tax due on a return filed
 24    within the time required by this subsection is  amended  by  the  taxpayer  or
 25    changed  by the state tax commission the rebate provided by this section shall
 26    be adjusted proportionally. The state  tax  commission  may  offset  a  rebate
 27    against taxes assessed the taxpayer but unpaid.
 28        (4)  In  the  case  of a short period return, the rebates provided by this
 29    section shall be reduced in proportion to the portion of calendar year 1999 to
 30    which the return applies.
 31        (5)  Except as provided in this subsection, no application  for  a  rebate
 32    provided  in  this  section  shall be required. The state tax commission shall
 33    cause each rebate to be mailed to the taxpayer or  taxpayers  at  the  address
 34    shown  on  the  return,  unless,  as a result of a more recent return, a newer
 35    address is shown on the commission's records. The  state  tax  commission  may
 36    provide a procedure by which rebates that are returned or undeliverable may be
 37    claimed.
 38        (6)  Any  person  aggrieved  by  any action of the state tax commission in
 39    regard to the rebates provided in this section shall file a petition with  the
 40    state  tax  commission  in the manner provided in section 63-3045, Idaho Code.
 41    Such a petition shall be subject to administrative and judicial review in  the
 42    manner provided by sections 63-3045 through 63-3049, Idaho Code.
 43        (7)  Rebates  authorized  by  this  section  shall  be paid from the state
 44    refund account established by section 63-3067,  Idaho  Code,  from  which  the
 45    amounts  necessary  to  pay  the rebates are hereby appropriated. In the event
 46    that, at the time the rebates are paid, there is an  insufficient  balance  in
 47    the  state  refund  account, the state board of examiners, upon application by
 48    the state tax commission, shall transfer sufficient  funds  from  the  general
 49    fund  to  make  the rebate payments and any other refunds due and payable from
 50    the state refund account.
 51        (8)  The state tax commission, the state treasurer and the state  control-
 52    ler  may  contract  with  a  commercial  bank for some or all of the services,
 53    including issuing payments,  relating to payment of  the  rebate  provided  in
 54    this section.
                                                                        
                                           5
                                                                        
  1        SECTION  3.  That Section 63-3022D, Idaho Code, be, and the same is hereby
  2    repealed.
                                                                        
  3        SECTION 4.  That Section 63-3022E, Idaho Code, be, and the same is  hereby
  4    amended to read as follows:
                                                                        
  5        63-3022E.  HOUSEHOLD  DEDUCTION  FOR DEPENDENTS SIXTY-FIVE YEARS OF AGE OR
  6    OLDER OR PERSONS WITH DEVELOPMENTAL DISABILITIES. (1) An additional  deduction
  7    from  taxable  income  shall be allowed in the case of an individual who main-
  8    tains a household, which includes as an immediate member of the family  resid-
  9    ing  in  that  household, one (1) or more individuals sixty-five (65) years of
 10    age or older, or a person with developmental disabilities as defined  in  sub-
 11    section (5) of section 66-402, Idaho Code, regardless of the age of the person
 12    when  such  developmental disability appeared, each of whom receives more than
 13    one-half (1/2) of his or her support for the  year  from  the  individual  who
 14    maintains  the  household. The amount of the deduction shall be one five thou-
 15    sand dollars ($15,000)  for each individual sixty-five (65) years  of  age  or
 16    older or with developmental disabilities.
 17        (2)  There shall not be allowed more than three (3) deductions of one five
 18    thousand dollars ($15,000) under the provisions of this section on any one (1)
 19    return.
 20        (3)  No  deductions  shall be allowed under this section for the person(s)
 21    in whose name(s) the income tax return is filed except as set forth in subsec-
 22    tion (4) of this section.
 23        (4)  A deduction of one five thousand dollars ($15,000) shall  be  allowed
 24    under this section for a person with a developmental disability, as defined in
 25    subsection (5) of section 66-402, Idaho Code, who is filing his own return.
                                                                        
 26        SECTION  5.  That Section 63-3022H, Idaho Code, be, and the same is hereby
 27    amended to read as follows:
                                                                        
 28        63-3022H.  DEDUCTION OF CAPITAL  GAINS.  (1)  If  an  individual  taxpayer
 29    reports  a  net  capital gain in determining taxable income, sixty one hundred
 30    percent (6100%) of the net capital gain from the sale or exchange of qualified
 31    property shall be a deduction in determining taxable income.
 32        (2)  The deduction provided in this section is limited to  the  amount  of
 33    the net capital gain from all property included in federal taxable income. Net
 34    capital  gains  treated  as ordinary income by the iInternal rRevenue cCode do
 35    not qualify for the deduction allowed in this section. The deduction otherwise
 36    allowable under this section shall be reduced by the  amount  of  any  federal
 37    capital gains deduction relating to such property, but not below zero.
 38        (3)  As  used  in  this  section  "qualified property" means the following
 39    property having an Idaho situs at the time of sale:
 40        (a)  Real property held at least eighteen (18) months;
 41        (b)  Tangible personal property used in Idaho for  at  least  twelve  (12)
 42        months by a revenue-producing enterprise;
 43        (c)  Cattle or horses held for breeding, draft, dairy or sporting purposes
 44        for  at  least  twenty-four (24) months if more than one-half (1/2) of the
 45        taxpayer's gross income (as defined in  section  61(a)  of  the  iInternal
 46        rRevenue  cCode)  for  the taxable year is from farming or ranching opera-
 47        tions in Idaho;
 48        (d)  Breeding livestock other than cattle or horses held at  least  twelve
 49        (12) months if more than one-half (1/2) of the taxpayer's gross income (as
 50        defined  in section 61(a) of the iInternal rRevenue cCode) for the taxable
 51        year is from farming or ranching operations in Idaho;
                                                                        
                                           6
                                                                        
  1        (e)  Timber grown in Idaho and held at least twenty-four (24) months;
  2        (f)  In determining the period for which property subject to this  section
  3        has  been  held  by  a  taxpayer,  the  provisions  of section 1223 of the
  4        iInternal rRevenue cCode shall apply, except that when the holding  period
  5        includes any period during which the taxpayer held property other than the
  6        property  sold,  all  property held during the holding period must qualify
  7        under this section.
  8        (4)  If an individual reports a capital gain from qualified property  from
  9    an  S  corporation  or  a partnership, a deduction shall be allowed under this
 10    section only to the extent the individual held his interest in the  income  of
 11    the  S  corporation or the partnership for the time required by subsection (3)
 12    of this section for the property sold.
 13        (5)  If an individual reports a capital gain from an estate, no  deduction
 14    shall be allowed under this section unless the holding period required in sub-
 15    section  (3) of this section was satisfied by the decedent, the estate, or the
 16    beneficiary, or a combination thereof.
 17        (6)  If an individual reports a capital gain from a  trust,  no  deduction
 18    shall be allowed under this section unless the holding period required in sub-
 19    section  (3)  of  this section was satisfied by the grantor, the trust, or the
 20    beneficiary, or a combination thereof.
 21        (7)  As used in this section "revenue-producing enterprise" means:
 22        (a)  The production, assembly, fabrication, manufacture, or processing  of
 23        any agricultural, mineral or manufactured product;
 24        (b)  The  storage,  warehousing, distribution, or sale at wholesale of any
 25        products of agriculture, mining or manufacturing;
 26        (c)  The feeding of livestock at a feedlot;
 27        (d)  The operation of laboratories or  other  facilities  for  scientific,
 28        agricultural,  animal  husbandry,  or industrial research, development, or
 29        testing.
                                                                        
 30        SECTION 6.  That Section 63-3024A, Idaho Code, be, and the same is  hereby
 31    amended to read as follows:
                                                                        
 32        63-3024A.  CREDITS  AND  REFUNDS. (a) Any resident individual not entitled
 33    to the credit allowed in subsection (b)(1), who is required to file by law and
 34    who has filed an Idaho income tax return, shall be allowed  a  credit  against
 35    taxes due under the Idaho income tax act equal to the amount of fifteen thirty
 36    dollars  ($1530.00)  for each personal exemption for which a deduction is per-
 37    mitted by section 151(b) and (c) of the Internal Revenue Code if  such  deduc-
 38    tion is claimed on the taxpayer's Idaho income tax return, and if the individ-
 39    ual  for whom the deduction is claimed is a resident of the state of Idaho. If
 40    taxes due are less than the total credit allowed, the taxpayer shall be paid a
 41    refund equal to the balance of the unused credit. If the credit or  refund  is
 42    not  claimed for the year for which the individual income tax return is filed,
 43    the right thereafter to claim such credit or refund shall  be  forfeited.  The
 44    state  tax  commission shall prescribe the method by which the refund, if any,
 45    is to be made to the taxpayer.
 46        (b) (1)  A resident individual who has reached  his  sixty-fifth  birthday
 47        before the end of his taxable year, who is required to file by law and who
 48        has  filed  an  Idaho income tax return, shall be allowed a credit against
 49        taxes due under the Idaho income tax act equal to  the  amount  of  thirty
 50        sixty  dollars ($360.00) for each personal exemption representing himself,
 51        a spouse over the age of sixty-five (65) years, or a  dependent  over  the
 52        age  of sixty-five (65) years, but shall be allowed a credit against taxes
 53        due under the Idaho  income  tax  act  equal  to  fifteen  thirty  dollars
                                                                        
                                           7
                                                                        
  1        ($1530.00)  for each personal exemption representing a spouse or dependent
  2        under the age of sixty-five (65) years. If taxes due  are  less  than  the
  3        total  credit  allowed,  the  taxpayer shall be paid a refund equal to the
  4        balance of the unused credit. If the credit or refund is not  claimed  for
  5        the  year  for  which the individual income tax return is filed, the right
  6        thereafter to claim such credit or refund shall be  forfeited.  The  state
  7        tax  commission shall prescribe the method by which the refund, if any, is
  8        to be made to the taxpayer.
  9        (2)  A resident individual who has reached his sixty-fifth birthday and is
 10        not required by law to file  an  Idaho  income  tax  return  and  who  has
 11        received  no  credit or refund under any other subsection of this section,
 12        shall be entitled to a refund  of  thirty  sixty  dollars  ($360.00).  Any
 13        refund  shall  be paid to such individual only upon his making application
 14        therefor at such time and in such manner as may be prescribed by the state
 15        tax commission.
 16        (c)  A resident individual of the state of Idaho who is:
 17        (i)   blind, or
 18        (ii)  a disabled American veteran of any war  engaged  in  by  the  United
 19        States,  whose  disability is recognized as a service connected disability
 20        of a degree of ten per cent percent (10%) or more, or who is in receipt of
 21        a pension for nonservice connected disabilities, in accordance  with  laws
 22        and regulations administered by the United States veterans administration,
 23        substantiated  by a statement as to status signed by a responsible officer
 24        of the United States veterans administration, or
 25        (iii) over sixty-two (62) years of age, and has been allowed none, or less
 26        than all, of the credit provided by subsection (a) or  subsection  (b)  of
 27        this  section,  shall  be entitled to a payment from the refund fund in an
 28        amount equal to fifteen thirty dollars ($1530.00), or the balance  of  his
 29        unused credit, whichever is less, upon making application therefor at such
 30        time and in such manner as the state tax commission may prescribe.
 31        (d)  Any  part-year resident entitled to a credit under this section shall
 32    receive a proportionate credit, in the manner above provided,  reflecting  the
 33    part of the year in which he was domiciled in this state.
 34        (e)  No  credit or refund may be claimed for an exemption which represents
 35    a person who has himself filed an Idaho income tax return claiming a deduction
 36    for his own personal exemption, and in no event shall more than one  (1)  tax-
 37    payer be allowed a credit or refund for the same exemption, or under more than
 38    one (1) subsection of this section.
 39        (f)  The  refunds  authorized by this section shall be paid from the state
 40    refund fund in the same manner as the refunds authorized by  section  63-3067,
 41    Idaho Code.
 42        (g)  An application for any refund which is due and payable under the pro-
 43    visions  of  this  section  must be filed with the state tax commission within
 44    three (3) years of:
 45        (i)  the due date, including extensions, of the return required under sec-
 46        tion 63-3030, Idaho Code, if the applicant is required to file  a  return,
 47        or
 48        (ii) the  15th  day  of  April of the year following the year to which the
 49        application relates if the applicant is not required to file a return.
                                                                        
 50        SECTION 7.  That Section 63-3025, Idaho Code, be, and the same  is  hereby
 51    amended to read as follows:
                                                                        
 52        63-3025.  TAX  ON  CORPORATE  INCOME.  For taxable years commencing on and
 53    after January 1, 1987 2001, a tax is  hereby  imposed  on  the  Idaho  taxable
                                                                        
                                           8
                                                                        
  1    income  of a corporation which transacts or is authorized to transact business
  2    in this state or which has income attributable to this state. The tax shall be
  3    equal to eight seven and eight-tenths percent (7.8%) of Idaho  taxable  income
  4    for  taxable  year 2001 and seven and five-tenths percent (7.5%) of Idaho tax-
  5    able income for taxable year 2002 and thereafter; provided, however, that  the
  6    tax  shall not be less than twenty dollars ($20.00); provided further that the
  7    twenty dollar ($20.00) minimum payment shall not be collected from  nonproduc-
  8    tive  mining  corporations. The tax imposed by this section shall not apply to
  9    corporations taxed pursuant to the provisions of section 63-3025A, Idaho Code.
                                                                        
 10        SECTION 8.  That Section 63-3025A, Idaho Code, be, and the same is  hereby
 11    amended to read as follows:
                                                                        
 12        63-3025A.  FRANCHISE  TAX. For taxable years commencing on and after Janu-
 13    ary 1, 1987 2001, a franchise tax shall be imposed upon  any  corporation  for
 14    the  privilege  of  exercising its corporate franchise within the state during
 15    such taxable year, including, but not  limited  to,  corporations  engaged  in
 16    business  in  Idaho for the exclusive purpose of performing contracts with the
 17    United States department of energy at the Idaho national engineering and envi-
 18    ronmental laboratory, which tax shall be measured by income which is attribut-
 19    able to this state under the provisions of this chapter and which tax shall be
 20    equal to eight percent (8%) of Idaho taxable income at the  rate  provided  in
 21    section 63-3025, Idaho Code; provided, however, that the tax shall not be less
 22    than twenty dollars ($20.00); provided further that the twenty dollar ($20.00)
 23    minimum payment shall not be collected from nonproductive mining corporations;
 24    but  the twenty dollar ($20.00) minimum tax shall apply to corporations quali-
 25    fied to file returns and actually filing returns under the provisions of  sub-
 26    chapter "S" of the Internal Revenue Code.
                                                                        
 27        SECTION  9.  That Section 63-3025D, Idaho Code, be, and the same is hereby
 28    amended to read as follows:
                                                                        
 29        63-3025D.  PAYMENT FOR DEPENDENTS SIXTY-FIVE YEARS OF AGE OR OLDER OR PER-
 30    SONS WITH DEVELOPMENTAL DISABILITIES. (1) In lieu of the deduction  from  tax-
 31    able income allowed by section 63-3022E, Idaho Code, a resident individual who
 32    maintains  a  household,  which  includes as an immediate member of the family
 33    residing in that household, one (1) or more individuals sixty-five (65)  years
 34    of  age or older or individuals with developmental disabilities, as defined in
 35    subsection (5) of section 66-402, Idaho Code, each of whom receives more  than
 36    one-half  (1/2)  of  his  or  her support for the year from the individual who
 37    maintains the household, shall be  entitled  to  a  payment  from  the  refund
 38    account  of  one  five hundred dollars ($1500) for each such elderly member of
 39    the family or family member with a developmental disability. Any such  payment
 40    shall  be paid to such individual only upon his making application therefor at
 41    such time and in such manner as may be prescribed by the state tax commission.
 42        (2)  No more than three (3) such payments shall be made under  the  provi-
 43    sions of this section to any one (1) individual in any calendar year.
 44        (3)  No payment may be claimed under the provisions of this section by the
 45    individual himself except as set forth in subsection (4) of this section.
 46        (4)  A  credit  of one five hundred dollars ($1500) shall be allowed under
 47    this section for a person with a developmental disability as defined  in  sub-
 48    section (5) of section 66-402, Idaho Code, who is filing his own tax return.
                                                                        
 49        SECTION 10.  That Section 63-3029E, Idaho Code, be, and the same is hereby
 50    amended to read as follows:
                                                                        
                                           9
                                                                        
  1        63-3029E.  DEFINITIONS  --  CONSTRUCTION OF TERMS. As used in this section
  2    and in section 63-3029F, Idaho Code:
  3        (1)  (a) "New employee" means a person from whom Idaho income tax has been
  4        withheld, employed by the taxpayer, in a revenue-producing enterprise cre-
  5        ating value-added natural resource products, and covered for  unemployment
  6        insurance purposes under chapter 13, title 72, Idaho Code, during the tax-
  7        able year for which the credit allowed by section 63-3029F, Idaho Code, is
  8        claimed. A person shall be deemed to be so engaged if such person performs
  9        duties on:
 10             (i)   A regular full-time basis; or
 11             (ii)  A part-time basis if such person is customarily performing such
 12             duties at least twenty (20) hours per week.
 13        No  credit  shall  be  earned unless the new employee shall have performed
 14        such duties for the taxpayer for a minimum of nine (9) months  during  the
 15        taxable year for which the credit is claimed.
 16        (b)  The  provisions  of paragraph (a) of this subsection notwithstanding,
 17        no credit shall be allowed for employment of persons  by  a  taxpayer  who
 18        acquires a revenue-producing enterprise from another taxpayer or who oper-
 19        ates in a place of business the same or a substantially identical revenue-
 20        producing  value-added  natural  resource  products enterprise business as
 21        operated by another taxpayer within the prior twelve (12)  months,  except
 22        as  the  prior taxpayer would have qualified under the provisions of para-
 23        graph (c) of this subsection. Employees transferred from  a  related  tax-
 24        payer shall not be included in the computation of the credit.
 25        (c)  The  number  of  employees  during  any taxable year for any taxpayer
 26        shall be the mathematical average of the number of employees  reported  to
 27        the  Idaho department of labor for employment security purposes during the
 28        twelve (12) months of the taxable year which qualified under paragraph (a)
 29        of this subsection. In the event the business is  in  operation  for  less
 30        than  the entire taxable year, the number of employees of the business for
 31        the year shall be the average number actually employed during  the  months
 32        of  operation,  providing that the qualifications of paragraph (a) of this
 33        subsection are met.
 34        (2)  "Revenue-producing enterprise" means the production, assembly, fabri-
 35    cation, manufacture or processing of any natural resource product.
 36        (3)  "Same or a substantially identical revenue-producing enterprise busi-
 37    ness" means a revenue-producing enterprise business in which the products pro-
 38    duced or sold, or the activities conducted are the same in character  and  use
 39    and  are  produced,  sold  or conducted in the same manner as, or for the same
 40    types of customers as, the products or activities produced, sold or  conducted
 41    in another revenue-producing enterprise business.
                                                                        
 42        SECTION 11.  That Section 63-3029F, Idaho Code, be, and the same is hereby
 43    amended to read as follows:
                                                                        
 44        63-3029F.  SPECIAL  CREDIT  AVAILABLE  --  NEW EMPLOYEES. (1) Any taxpayer
 45    shall be allowed a credit, in an amount determined  under  subsection  (2)  of
 46    this  section,  against    the tax imposed by this chapter, other than the tax
 47    imposed by section 63-3082, Idaho Code, for any taxable year during which  the
 48    taxpayer's  employment of new employees, as defined under section 63-3029E(1),
 49    Idaho Code, increases above the taxpayer's average employment for either:  (a)
 50    the  prior  taxable year, or (b) the average of three (3) prior taxable years,
 51    whichever is higher. No credit shall be allowed under this section unless  the
 52    number of new employees equals or exceeds one (1) person.
 53        (2)  The credit authorized in subsection (1) of this section shall be five
                                                                        
                                           10
                                                                        
  1    hundred  dollars  ($500)  per new employee, but the total credit allowed shall
  2    not exceed three and one-quarter  percent  (3.25%)  of  net  income  from  the
  3    taxpayer's  corporate, proprietorship, partnership, small business corporation
  4    or limited liability company revenue-producing enterprise  business  in  which
  5    the employment occurred. Additionally, the total of this and all other credits
  6    allowed  under  this  chapter  except  for  the credits allowed under sections
  7    63-3024A, 63-3025D and 63-3029, Idaho Code,  taken  during  any  taxable  year
  8    shall  not exceed forty-five percent (45%) of the tax otherwise imposed on the
  9    taxpayer for the taxable year for which such credit is allowed.
 10        (3)  If the sum of the credit carryovers from the credit allowed  by  sub-
 11    section (2) of this section and the amount of credit for the taxable year from
 12    the  credit  allowed  by  subsection (2) of this section exceed the limitation
 13    imposed by subsection (2) of this section for the current  taxable  year,  the
 14    excess  attributable  to  the  current taxable year's credit shall be a credit
 15    carryover to the three (3) succeeding taxable  years.  The  entire  amount  of
 16    unused  credit  shall  be  carried  forward  to the earliest of the succeeding
 17    years, wherein the oldest available unused credit shall be used first, so long
 18    as the employment level for which the credit was granted is still maintained.
                                                                        
 19        SECTION 12.  That Chapter 30, Title 63, Idaho Code, be, and  the  same  is
 20    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 21    ignated as Section 63-3029G, Idaho Code, and to read as follows:
                                                                        
 22        63-3029G.  CREDITS FOR RESEARCH ACTIVITIES  CONDUCTED  IN  THIS  STATE  --
 23    CARRY FORWARD.
 24        (1) (a)  Subject  to  the  limitations  of this section, for taxable years
 25        beginning between January 1, 2001, and December 31, 2003, inclusive, there
 26        shall be allowed to  a  taxpayer  a  nonrefundable  credit  against  taxes
 27        imposed  by  sections  63-3024,  63-3025  and  63-3025A,  Idaho  Code, for
 28        increasing research activities in Idaho.
 29        (b)  The credit allowed by subsection (1)(a) of this section shall be  the
 30        sum of:
 31             (i)   Five  percent (5%) of the excess of qualified research payments
 32             for research conducted in Idaho over the base amount; and
 33             (ii)  Five percent (5%) basic research payments allowable under  sub-
 34             section  (e)  of  section  41  of the Internal Revenue Code for basic
 35             research conducted in Idaho.
 36        (2)  As used in this section:
 37        (a)  The terms "qualified research payments," "qualified research," "basic
 38        research payments" and "basic research" shall be as defined in section  41
 39        of the Internal Revenue Code except that the research must be conducted in
 40        Idaho.
 41        (b)  The term "base amount" shall mean an amount calculated as provided in
 42        sections 41(c) and 41(h) of the Internal Revenue Code, except that:
 43             (i)   The  base amount does not include the calculation of the alter-
 44             native incremental credit provided for in  section  41(c)(4)  of  the
 45             Internal Revenue Code;
 46             (ii)  A  taxpayer's  gross receipts include only those gross receipts
 47             attributable  to sources within this state as provided in subsections
 48             (q) and (r) of section 63-3027, Idaho Code; and
 49             (iii) Notwithstanding section 41(c) of the Internal Revenue Code, for
 50             purposes of calculating the base amount, a taxpayer:
 51                  (A)  May elect to be treated as a start-up company  as  provided
 52                  in  section 41(c)(3)(B) of the Internal Revenue Code, regardless
 53                  of whether  the  taxpayer  meets  the  requirements  of  section
                                                                        
                                           11
                                                                        
  1                  41(c)(3)(B)(i)(I) or (II) of the Internal Revenue Code; and
  2                  (B)  May not revoke an election to be treated as a start-up com-
  3                  pany.
  4        (3)  The credit allowed by subsection (1)(a) of this section together with
  5    any  credits  carried  forward  under subsection (5) of this section shall not
  6    exceed the amount of tax due under sections  63-3024,  63-3025  and  63-3025A,
  7    Idaho  Code,  after allowance for all other credits permitted by this chapter.
  8    When credits earned in more than one (1) taxable year are available, the  old-
  9    est credits shall be applied first.
 10        (4)  In the case of a group of corporations filing a combined report under
 11    subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
 12    of  the group but not used by that member may be used by another member of the
 13    group. For a combined group of corporations, any member of the group may claim
 14    credit carried forward unless the member who earned the credit  is  no  longer
 15    included in the combined group.
 16        (5)  The  credit  allowed  by  subsection  (1)(a) of this section shall be
 17    claimed for the taxable year during  which  the  taxpayer  qualifies  for  the
 18    credit. If the credit exceeds the limitation under subsection (3) of this sec-
 19    tion,  the  excess  amount  may  be carried forward for a period that does not
 20    exceed the next fourteen (14) taxable years.
 21        (6)  In addition to other needed rules, the state tax commission may  pro-
 22    mulgate rules prescribing, in the case of S corporations, partnerships, trusts
 23    or  estates,  a  method  of  attributing  the credit under this section to the
 24    shareholders, partners or beneficiaries in proportion to their  share  of  the
 25    income from the S corporation, partnership, trust or estate.
                                                                        
 26        SECTION 13.  That Section 63-3029H, Idaho Code, be, and the same is hereby
 27    amended to read as follows:
                                                                        
 28        63-3029HP.  PRIORITY  OF  CREDITS.  When  a  taxpayer subject to any taxes
 29    imposed under this chapter is entitled to two (2) or more credits against such
 30    taxes, the priority of credits shall be determined in the following order:
 31        (a)  Nonrefundable credits. Nonrefundable credits shall be applied to  the
 32    tax liability before application of refundable credits. If a taxpayer is enti-
 33    tled  to  more than one (1) nonrefundable credit, the credits shall be applied
 34    in the order in which the statutes authorizing the credits were enacted by the
 35    legislature.
 36        (b)  Refundable credits. Refundable credits shall be applied  to  the  tax
 37    liability after application of any nonrefundable credits.
                                                                        
 38        SECTION  14.  That  Chapter  30, Title 63, Idaho Code, be, and the same is
 39    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 40    ignated as Section 63-3029H, Idaho Code, and to read as follows:
                                                                        
 41        63-3029H.  CREDIT  FOR HOUSEHOLD AND DEPENDENT CARE SERVICES NECESSARY FOR
 42    GAINFUL EMPLOYMENT. (1) A resident individual who  is  entitled,  for  federal
 43    income  tax  purposes, to claim and who does claim the credit provided by sec-
 44    tion 21 of the Internal Revenue Code shall  be  entitled  to  a  nonrefundable
 45    credit against taxes imposed by section 63-3024, Idaho Code, equal to one-half
 46    (1/2)  of  the credit allowable on that taxpayer's federal return for the same
 47    taxable year.
 48        (2)  A nonresident or part-year resident individual who is  entitled,  for
 49    federal  income  tax purposes, to claim and who does claim the credit provided
 50    by section 21 of the Internal Revenue Code shall be entitled to a proportional
 51    part of the credit otherwise provided in subsection (1) of this  section.  The
                                                                        
                                           12
                                                                        
  1    proportion  shall  be  determined in accordance with the provisions of section
  2    63-3026A(6), Idaho Code.
  3        (3)  The credit allowed by this section shall not exceed the total  amount
  4    of  taxes  due under section 63-3024, Idaho Code, after allowance of all other
  5    credits provided in this chapter.
                                                                        
  6        SECTION 15.  That Sections 63-3029E and 63-3029F, Idaho Code, be, and  the
  7    same are hereby repealed.
                                                                        
  8        SECTION  16.  That  Chapter  30, Title 63, Idaho Code, be, and the same is
  9    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 10    ignated as Section 63-3029E, Idaho Code, and to read as follows:
                                                                        
 11        63-3029E.  DEFINITIONS  --  CONSTRUCTION OF TERMS. As used in this section
 12    and in section 63-3029F, Idaho Code:
 13        (1)  (a)  "New employee" means a person from whom  Idaho  income  tax  has
 14        been  withheld, employed by the taxpayer in a revenue-producing enterprise
 15        creating value-added natural resource products, and covered for  unemploy-
 16        ment insurance purposes under chapter 13, title 72, Idaho Code, during the
 17        taxable year for which the credit allowed by section 63-3029F, Idaho Code,
 18        is  claimed. A person shall be deemed to be so engaged if such person per-
 19        forms duties on:
 20             (i)   A regular full-time basis; or
 21             (ii)  A part-time basis if such person is customarily performing such
 22             duties at least twenty (20) hours per week.
 23        No credit shall be earned unless the new  employee  shall  have  performed
 24        such  duties  for the taxpayer for a minimum of nine (9) months during the
 25        taxable year for which the credit is claimed.
 26        (b)  The provisions of paragraph (a) of this  subsection  notwithstanding,
 27        no  credit  shall  be  allowed for employment of persons by a taxpayer who
 28        acquires a revenue-producing enterprise from another taxpayer or who oper-
 29        ates in a place of business the same or a substantially identical revenue-
 30        producing value-added natural resource products enterprise as operated  by
 31        another  taxpayer within the prior twelve (12) months, except as the prior
 32        taxpayer would have qualified under the provisions  of  paragraph  (c)  of
 33        this  subsection.  Employees transferred from a related taxpayer shall not
 34        be included in the computation of the credit.
 35        (c)  The number of employees during any  taxable  year  for  any  taxpayer
 36        shall  be  the mathematical average of the number of employees reported to
 37        the Idaho department of labor for employment security purposes during  the
 38        twelve (12) months of the taxable year which qualified under paragraph (a)
 39        of  this  subsection.  In  the event the business is in operation for less
 40        than the entire taxable year, the number of employees of the business  for
 41        the  year  shall be the average number actually employed during the months
 42        of operation, providing that the qualifications of paragraph (a)  of  this
 43        subsection are met.
 44        (2)  "Revenue-producing enterprise" means the production, assembly, fabri-
 45    cation, manufacture or processing of any natural resource product.
 46        (3)  "Same  or  a  substantially  identical  revenue-producing enterprise"
 47    means a revenue-producing enterprise in which the products produced  or  sold,
 48    or  the  activities  conducted  are the same in character and use and are pro-
 49    duced, sold or conducted in the same manner as, or for the same types of  cus-
 50    tomers  as,  the products or activities produced, sold or conducted in another
 51    revenue-producing enterprise.
                                                                        
                                           13
                                                                        
  1        SECTION 17.  That Chapter 30, Title 63, Idaho Code, be, and  the  same  is
  2    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
  3    ignated as Section 63-3029F, Idaho Code, and to read as follows:
                                                                        
  4        63-3029F.  SPECIAL CREDIT AVAILABLE -- NEW  EMPLOYEES.  (1)  Any  taxpayer
  5    shall  be  allowed  a  credit, in an amount determined under subsection (2) of
  6    this section, against the tax imposed by this  chapter,  other  than  the  tax
  7    imposed  by section 63-3082, Idaho Code, for any taxable year during which the
  8    taxpayer's employment of new employees, as defined under section  63-3029E(1),
  9    Idaho Code, increases above the taxpayer's average employment for either:  (a)
 10    the  prior  taxable year, or (b) the average of three (3) prior taxable years,
 11    whichever is higher. No credit shall be allowed under this section unless  the
 12    number of new employees equals or exceeds one (1) person.
 13        (2)  The credit authorized in subsection (1) of this section shall be five
 14    hundred  dollars  ($500)  per new employee, but the total credit allowed shall
 15    not exceed three and one-quarter  percent  (3.25%)  of  net  income  from  the
 16    taxpayer's  corporate, proprietorship, partnership, small business corporation
 17    or limited liability company revenue-producing enterprise in which the employ-
 18    ment occurred. Additionally, the total of this and all other  credits  allowed
 19    under  this  chapter  except  for the credits allowed under sections 63-3024A,
 20    63-3025D and 63-3029, Idaho Code, taken during  any  taxable  year  shall  not
 21    exceed  forty-five  percent (45%) of the tax otherwise imposed on the taxpayer
 22    for the taxable year for which such credit is allowed.
 23        (3)  If the sum of the credit carryovers from the credit allowed  by  sub-
 24    section (2) of this section and the amount of credit for the taxable year from
 25    the  credit  allowed  by  subsection (2) of this section exceed the limitation
 26    imposed by subsection (2) of this section for the current  taxable  year,  the
 27    excess  attributable  to  the  current taxable year's credit shall be a credit
 28    carryover to the three (3) succeeding taxable  years.  The  entire  amount  of
 29    unused  credit  shall  be  carried  forward  to the earliest of the succeeding
 30    years, wherein the oldest available unused credit shall be used first, so long
 31    as the employment level for which the credit was granted is still maintained.
                                                                        
 32        SECTION 18.  The provisions of Sections 10 through  12  of  this  act  are
 33    hereby  declared  to be nonseverable from other provisions within each section
 34    and if any provision of any of those sections or the application of such  pro-
 35    vision  to any person or circumstance is declared invalid for any reason, such
 36    declaration shall render the entire section invalid but not other sections  of
 37    this act.
                                                                        
 38        SECTION  19.  An  emergency  existing  therefor, which emergency is hereby
 39    declared to exist, Sections 1 through 14 and Section 18 of this act  shall  be
 40    in  full  force and effect on and after passage and approval and retroactively
 41    to January 1, 2001. Sections 15, 16 and 17 of this act shall be in full  force
 42    and effect on and after January 1, 2004.

Statement of Purpose / Fiscal Impact


                      STATEMENT OF PURPOSE

                            RS 10971

This income tax relief bill makes permanent a 0.4% rate
reduction from year 2000 rate for individuals, rebates 10.6% of
1999 income tax paid to individuals subject to a $25 minimum
and $2,500 maximum, permanently doubles grocery credit for everyone
and permanently reduces the corporate income rate .5%. It
expands the current capital gains exclusion from 60% to 100%
for certain tangible assets and provides credits for Idaho
business development, including research and development and
creation of new jobs. It changes the child care deduction to a
credit equal to half the federal credit and permanently
increases the elderly dependant care credit from $100 to $500.



                          FISCAL IMPACT
                                                  2002           2003
     Individual rate reduction                  $ 14.6         $ 76.5
     *Indivjdual rebate                           91.0             
    Grocery credit                                18.6           18.8
    Corporate rate                                 3.4            8.5
    Research and Development                       7.0            7.75
    New jobs                                       1.5            1.5
    Child care credit                              1.5            1.5
    Elderly dependant care credit                  1.2            1.2
    Capital gains                                  8.7            8.7
Total                                           $147.5        $124.45
*only entry using one time "surplus            funds."


Contact
     Name: Representative Crow Representative Moyle
     Phone:  332 1000









STATEMENT OF PURPOSE/FISCAL NOTE                     H 15