Print Friendly HOUSE BILL NO. 439
– Income tax credit, groceries
HOUSE BILL NO. 439
View Bill Status
View Bill Text
View Statement of Purpose / Fiscal Impact
Text to be added within a bill has been marked with Bold and
Underline. Text to be removed has been marked with
Strikethrough and Italic. How these codes are actually displayed will
vary based on the browser software you are using.
This sentence is marked with bold and underline to show added text.
This sentence is marked with strikethrough and italic, indicating
text to be removed.
H0439...............................................by REVENUE AND TAXATION
INCOME TAX CREDIT - GROCERIES - Repeals and adds to existing law to provide
for income tax credits or refunds for certain resident individuals to
offset the cost of sales tax on groceries; to provide a maximum credit of
ninety dollars; to provide for adjustments to the credit to account for
inflation; and to provide for suspension of the increase in the credit or
refund if certain circumstances occur.
01/30 House intro - 1st rdg - to printing
01/31 Rpt prt - to Rev/Tax
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-ninth Legislature Second Regular Session - 2008
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 439
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO INCOME TAXES; REPEALING SECTION 63-3024A, IDAHO CODE, RELATING TO
3 THE GROCERY TAX CREDIT; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE
4 ADDITION OF A NEW SECTION 63-3024A, IDAHO CODE, TO PROVIDE FOR INCOME TAX
5 CREDITS OR REFUNDS TO CERTAIN RESIDENT INDIVIDUALS, TO PROVIDE PROCEDURES,
6 TO PROVIDE A METHOD OF PAYMENT, TO PROVIDE A STATUTE OF LIMITATIONS, TO
7 PROVIDE FOR THE DONATION OF CREDITS, TO PROVIDE FOR CANCELLATION OF A
8 FUTURE ADJUSTMENT AND TO PROVIDE FOR THE APPLICATION OF AN INDEX TO FUTURE
9 CREDIT AMOUNTS; AND DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE
11 Be It Enacted by the Legislature of the State of Idaho:
12 SECTION 1. That Section 63-3024A, Idaho Code, be, and the same is hereby
14 SECTION 2. That Chapter 30, Title 63, Idaho Code, be, and the same is
15 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
16 ignated as Section 63-3024A, Idaho Code, and to read as follows:
17 63-3024A. FOOD TAX CREDITS AND REFUNDS. (1) Any resident individual who
18 is required to file and who has filed an Idaho income tax return shall be
19 allowed a credit against taxes due under the Idaho income tax act for each
20 personal exemption for which a deduction is permitted by section 151(b) and
21 (c) of the Internal Revenue Code, and which is claimed on the taxpayer's Idaho
22 income tax return. The amount of the credit for tax year 2008 shall be as fol-
24 When Idaho taxable income is: The amount of credit for each
25 personal exemption is:
26 $1,000 or less $55.00
27 Over $1,000 $30.00
28 Subject to the limitations provided in subsection (13) of this section,
29 the larger credit allowed by this subsection shall be increased to seventy-
30 five dollars ($75.00) for tax year 2009, and ninety dollars ($90.00) for tax
31 year 2010. Subject to the limitations provided in subsection (13) of this sec-
32 tion, the smaller credit allowed by this subsection shall be increased to
33 forty dollars ($40.00) for tax year 2009, and fifty dollars ($50.00) for tax
34 year 2010.
35 Subject to the limitations provided in subsection (13) of this section,
36 for tax year 2011 and each year thereafter, both credits allowed by this sub-
37 section shall equal the index created in subsection (14) of this section,
38 rounded down to the nearest ten dollar ($10.00) increment, provided however,
39 that the amount of credit allowed shall not be adjusted by more than ten dol-
40 lars ($10.00) in tax year 2011, as compared to tax year 2010, nor shall the
41 amount of credit allowed be adjusted by more than ten dollars ($10.00) in any
42 future tax year, as compared to the previous tax year.
1 If taxes due are less than the total credit allowed, the taxpayer shall be
2 paid a refund equal to the balance of the unused credit.
3 (2) A resident individual who is not required to file an Idaho income tax
4 return and for whom no credit or refund is allowed under any other subsection
5 of this section shall, subject to the limitations of subsections (3), (4),
6 (5), (6), (7) and (8) of this section, be entitled to a refund in the amount
7 provided in subsection (1) of this section.
8 (3) A resident individual who has reached his sixty-fifth birthday before
9 the end of his taxable year and who has claimed the credit available under
10 subsection (1) of this section, in addition to the amount of credit or refund
11 due under subsection (1) of this section, shall be entitled to twenty dollars
12 ($20.00) which shall be claimed as a credit against any taxes due under the
13 Idaho income tax act. If taxes due are less than the total credit allowed the
14 individual shall be paid a refund equal to the balance of the unused credit.
15 (4) Except as provided in subsection (9) of this section, a credit or
16 refund under this section is only available if the individual for whom a per-
17 sonal exemption is claimed is a resident of the state of Idaho.
18 (5) In no event shall more than one (1) taxpayer be allowed a credit or
19 refund for the same personal exemption, or under more than one (1) subsection
20 of this section.
21 (6) In the event that a credit or refund is attributable to any individ-
22 ual for whom assistance under the federal food stamp program was received for
23 any month or part of a month during the taxable year for which the credit or
24 refund is claimed, the credit or refund allowed under this section shall be in
25 proportion to the number of months of the year in which no assistance was
27 (7) In the event that a credit or refund is attributable to any individ-
28 ual who has been incarcerated for any month or part of a month during the tax-
29 able year for which the credit or refund is claimed, the credit or refund
30 allowed under this section shall be in proportion to the number of months of
31 the year in which the individual was not incarcerated.
32 (8) No credit or refund shall be paid that is attributable to an individ-
33 ual residing illegally in the United States.
34 (9) Any part-year resident entitled to a credit under this section shall
35 receive a proportionate credit reflecting the part of the year in which he was
36 domiciled in this state.
37 (10) Any refund shall be paid to such individual only upon his making
38 application therefor, at such time and in such manner as may be prescribed by
39 the state tax commission. The state tax commission shall prescribe the method
40 by which the refund is to be made to the taxpayer. The refunds authorized by
41 this section shall be paid from the state refund fund in the same manner as
42 the refunds authorized by section 63-3067, Idaho Code.
43 (11) An application for any refund which is due and payable under the pro-
44 visions of this section must be filed with the state tax commission within
45 three (3) years of:
46 (a) The due date, including extensions, of the return required under sec-
47 tion 63-3030, Idaho Code, if the applicant is required to file a return;
49 (b) The fifteenth day of April of the year following the year to which
50 the application relates if the applicant is not required to file a return.
51 (12) The state tax commission shall provide income tax payers with the
52 irrevocable option of donating credited funds accruing pursuant to this sec-
53 tion. Any funds so donated shall be remitted from the refund fund to the coop-
54 erative welfare fund, created pursuant to section 56-401, Idaho Code, and
55 shall be used solely for the purpose of providing low-income Idahoans with
1 assistance in paying home energy costs.
2 (13) The credit adjustment required by subsection (1) of this section
3 shall not take place if a majority of the membership of each house of the leg-
4 islature adopts a concurrent resolution requesting that the governor issue an
5 executive order directing the state tax commission that the credit allowed in
6 this section remain unchanged for the tax year in which the requesting legis-
7 lature is meeting, and if the governor concurs and issues such an executive
8 order, the credit shall remain unchanged for that tax year.
9 (14) The state tax commission shall establish a per capita food tax index,
10 beginning at ninety dollars ($90.00) for tax year 2010. For each subsequent
11 tax year, the state tax commission shall modify the index as follows:
12 (a) Adjust the index by the percentage change in the state sales tax rate
13 by dividing the new rate by the old rate, and multiplying the result by
14 the current index dollar figure.
15 (b) Adjust the index by the percentage change in the average cost of
16 food, as measured by the United States department of labor's consumer
17 price index for all urban consumers (CPI-U). For this measure, the state
18 tax commission shall use the average of the twelve (12) most recent months
19 available at the time that income tax forms are prepared for publication,
20 as compared to the average of the same twelve (12) months from the prior
21 year's period.
22 SECTION 3. An emergency existing therefor, which emergency is hereby
23 declared to exist, this act shall be in full force and effect on and after its
24 passage and approval, and retroactively to January 1, 2008.
STATEMENT OF PURPOSE
The income tax credit provided to Idahoans as an offset for the
sales tax they pay on food consumed at home has not kept up with changes
in the sales tax rate or inflation. Current law fails to provide even
this partial offset for the poorest Idahoans, since most are ineligible
to receive the credit unless their incomes are high enough to owe state
This legislation addresses the inadequacies of the current law by
incrementally increasing this "Food Tax Credit" starting with an increase
to $55 for the poorest Idahoans, $30 for all other Idahoans, and an
additional $20 for seniors for tax year 2008. The credit continues to
develop each tax year and ties to an index in tax year 2011 and each year
thereafter, eventually offsetting, on average, the state sales tax on
This legislation also helps the poorest Idahoans by allowing
virtually all citizens to file for the credit, even if incomes are too
low to incur an income liability.
The total fiscal impact is negative $23.8 million to the General
Fund for FY 2009; $18.1M for FY 2010; $16.4M for FY 2011; $11.1M for FY
2012; $11.1M for 2013; $11.1M for FY 2014; and $11.1m for FY 2015.
Rep. Bayer, Rep. Vander Woude, Rep. Eskridge, Rep. Henderson; Rep. Nonini;
Rep. Anderson; Rep. Chadderdon; Rep. McGeachin; Rep. Mathews; Rep. Roberts;
Rep. Labrador; Rep. Kren; Rep. Hagedorn; Sen. Fulcher; Sen. Keough; Sen.
McKenzie; Sen. Goedde; Sen. Broadsword; Sen. Hammond
STATEMENT OF PURPOSE/FISCAL NOTE H 439