When you hit the neighborhood grocery store for your weekly shopping trip for eggs, milk, bread, fruits, and other staples, you pay the cost of the groceries plus an additional 6% for the state sales tax going to the state general fund. The grocery tax brings in about $246 million for the state budget.
You may be surprised to learn that Idaho is one of only five states to fully apply sales taxes on grocery purchases. Of our six neighbor states, only Utah taxes groceries, but does so at a lower rate than other purchases. This legislative session, Idaho can and should repeal the sales tax on groceries. Many families are hurting from lost work opportunities and lost wages in the year of COVID. Families need some tax relief. Also, because so much federal money is flowing into the state, our budget is rolling in surplus dollars (over $600 million) and money built up in a tax relief fund ($180 million) set aside exclusively for tax relief.
Last week, I presented a plan to exempt all groceries from the 6% sales tax while reducing or eliminating the grocery income tax credit. The proposal would provide immediate tax relief to every Idahoan. It would reduce revenue coming into the state budget, but would also reduce the grocery tax credit Idahoans get on their income taxes. Overall, the bill would decrease the state's general fund by $43 million in 2022 because the tax and revenue difference is partially offset by using Tax Relief Fund money that has been built up. This means Idahoans would have around $130 millions more to spend on other things. It is a $130 million tax cut! Also, there would be more economic activity from increased grocery sales in Idaho and other increases from Idahoans who have more money left to spend in other parts of the economy.
The bill is a slam dunk, right? Well, not quite. Despite its amazing support, and even the Governor saying he would sign a grocery tax repeal, the chair of the House Revenue and Taxation Committee has so far declined to set a hearing for the bill. This is disappointing especially because so many Idahoans need lower taxes, want lower taxes, the budget is in great shape, and there is seemingly no need to keep so many tax dollars from hardworking families across the state.
Personally, I have no doubt the bill would sail through committees and through both chambers if it were allowed hearings and floor votes. Hopefully the bill will be scheduled soon, Idahoans deserve tax cuts after so much overspending the last few years and after such a difficult 2020. If you would like to see this plan go forward, please contact your representatives and the House Revenue and Taxation Committee chairman, Rep. Steve Harris.
Last Friday, in our JFAC committee hearing, I asked Boise State University President, Marlene Tromp, the following question about programming and the budget for BSU.
"Thank you, President Tromp for your presentation.
Last year in the budgeting process this area of the budget, Higher Education, was particularly contentious. Not much has changed. Many Idahoans and legislators are still frustrated with BSU and some of what they see at other universities. They see the mission of the BSU shifting rather dramatically from being a premier institution of Higher Education toward becoming an institution of Higher Indoctrination or Higher Social Activism. The source of many legislators’ frustration is what is happening at BSU.
After last year’s budget battle, and throughout 2020, instead of tempering its agenda, BSU doubled down. In a year of budget holdbacks and cost containments and furloughs, BSU actually hired new administrators in the BUILD forum which has a dedicated social justice mission. In a year where there was political unrest across the nation directed largely at police forces, BSU joined in by ending its longstanding contract with the Boise Police department. BSU effectively expelled Big City Coffee from its campus for exercising its free speech in displaying a flag in support of our police. BSU has faculty and admins who unabashedly support the Black Lives Matter Marxist agenda and BSU departments issued statements on the BSU website claiming commitment to this Marxist group. BSU is requiring more courses in social justice, teaching topics like Critical Race Theory and Intersectionalism, while reducing required credits in traditional courses like American History and Government.
This has not gone unnoticed. Many legislators here are even more upset to see taxpayer dollars spent, not for Higher Education, but at least in part for advancing a social agenda that is contrary to the values of most of Idaho. Taxpayers should not be forced to fund an activist institution that fights against their values and does so to the detriment of its students.
The budget for all of Higher education ran at nearly $630 million dollars in FY21. That is the 3rd largest spending category in the General Fund. The spending for all of Idaho’s public universities is rolled into this one budget. Many legislators, frustrated with BSU, want to defund the Social Justice Agenda by reducing higher education spending. Whether or not you think the legislators are justified in their views is not the question here. The reality is our constituents are very upset and want some action taken against BSU in particular. Legislators are likewise upset, especially because of BSU doubling down on its controversial agenda, and they want to do something about it.
My question is this. What do you, President Tromp, as the leader of BSU think of separating BSU’s budget out from the other universities to be decided on its own and so that the other universities do not get rolled up in the controversy BSU has invited from the legislature? Would you be ok with determining BSU’s budget on its own, so the other universities don’t become collateral damage?"
President Tromp's answer was essentially to keep all the budgets together and she seemed unconcerned about BSU's controversy affecting other universities. I will work to hold BSU accountable and keep the other universities harmless nonetheless. Idaho taxpayers should not have to pay taxes only to see those dollars supporting programs which violate Idaho values.
H7: A Bill to Protect Idaho Investments
The Sound Money Reserves Act (H7) allows Idaho's State Treasurer to invest some of Idaho's idle reserves in physical gold and silver quantities.
The recent explosion in U.S. government spending and Federal Reserve money printing in response to the Covid-19 pandemic has sparked a renewed focus on the critical role gold and silver can play in hedging against systemic risks.
Idaho State Treasurer’s office currently has more than $7 billion in assets under management. The Local Government Investment Pool, Diversified Bond Fund, and the State of Idaho Idle Pool are principally invested debt paper, e.g., U.S. Treasuries, money market funds, corporate debt, repurchase agreements, and other dollar-denominated debt. These holdings carry risk based on how those corporations and institutions are managed and generally offer a very low yield (below the rate of inflation) leading to a steady erosion in overall value from their negative real rate of return.
Any reserve account with the objective of maintaining the value of its holdings should include a meaningful allocation to real money, physical gold and silver, which preserves purchasing power over the medium to longer term. Monetary metals have low correlation to other assets, providing important diversification. Gold and silver are liquid and are bought or sold at current market value. Physical gold and silver held in a
nearby depository carry no counterparty risk and are removed from Wall Street.
By including physical gold and silver in 67-1210, Idaho Code, the Treasurer could hold a portion of state funds in the monetary metals to hedge Idaho’s “idle moneys” against the risks of inflation and financial turmoil or to secure capital gains measured in depreciating Federal Reserve Notes (dollar bills, yo).
If Idaho holds gold and silver, it provides a hedge against inflation, debt default risks, stock market declines, and volatility – and it historically increases overall returns. Gold and silver do not have default or loss of purchasing power risks that bonds or other debt instruments carry.
The Treasurer’s new authority would be confined to holding gold and silver directly and in a manner that does not assume the management risks involved with other current state holdings, such as corporate bonds, treasury bills, and other debt instruments. This measure empowers Idaho to hold physical gold and silver, directly owned by the State of Idaho and kept in secure vault storage meeting industry security standards.
House Bills:
H1 Governor's Powers in Emergency House State Affairs
H4 Parental Rights in Disasters House Judiciary and Rules
H7 Idaho Treasury Gold/Silver Holdings House State Affairs
H21 Lemonade Stand Freedom Senate Local Government
H56 Abolish Abortion House Ways and Means
H63 Vaccination Freedom House Ways and Means
H66 Bond and Levy Ballot Disclosure House 3rd Reading
H77 Responsible Childhood Independence House Judiciary and Rules
HCR1 Resolution to End Emergency House State Affairs
HCR2 Gatherings and Group Size Senate State Affairs
HJR1 Legislature Calling Sessions Senate State Affairs
Senate Bills:
S1001 Disaster, Governor Powers Senate State Affairs
S1002 Disaster, Governor Spending Powers Senate State Affairs
S1003 Governor Powers, Martial Law Senate State Affairs
S1027 Idaho Wrongful Conviction Act Senate 3rd Reading
S1028 Minimum Wage Increase Senate State Affairs
S1044 Eminent Domain Limitation Senate Local Government
SCR101 Terminating Disaster Emergency Senate State Affairs
SJR101 Psychoactive Drugs Amendment Senate 3rd Reading
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You can find your legislators by visiting the Idaho Legislature website. Please note the Who Is My Legislator? link on the op right of the main page. You can enter your address and zip code so the website can identify your Senator and Representatives. Click on your Senator's or Representative's picture and you will see all the contact information you need to get in touch with them. Click on the email address and you can send them an email right there. Another good place to go is the List of Legislators in the Senate and House. Here, you can see bios for your legislators and click the links to subscribe to their weekly newsletters (like you're reading right now).
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