Revised grocery tax credit bill advances in Idaho Legislature

Yahoo

13-02-2025

Shoppers make their way through a store aisle at a Walmart. (Marty Schladen/Ohio Capital Journal)
The Idaho House Revenue and Taxation Committee on Thursday recommended advancing a slightly revised version of a bill to increase the tax credit Idaho taxpayers receive for buying groceries.
The new bill, House Bill 231, is a slightly modified version of House Bill 61, the original grocery tax credit bill that legislators introduced on Jan. 27. Both bills increase the annual tax credit that Idahoans receive each year from $120 to $155. The only difference is the new version inserts the word 'retail' before the word 'seller' on three different occasions.
House Majority Leader Jason Monks, R-Meridian, sponsored both bills. On Thursday, the House Revenue and Taxation Committee voted to hold the original bill, House Bill 61. Committee members then voted to introduce the new bill, House Bill 231, and recommended sending it straight to the second reading calendar on the floor of the Idaho House of Representatives.
Monks said the point of the bill is to provide an across-the-board increase in the tax credit for groceries to combat inflation.
Idaho does charge sales tax on groceries, but all Idaho taxpayers and their dependents receive a tax credit intended to offset that tax.
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Monks and other Republican legislative leaders said they prefer offering the tax credit to Idahoans rather than repealing the sales tax on food outright because it allows the state to still collect revenue from the sales tax that tourists and other out-of-state visitors pay.
Currently, seniors 65 and older receive a grocery tax credit of $140 a year, while the rest of the population receives $120 a year. If the new bill is passed into law, everyone would receive the same $155 credit.
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'We've seen a lot of increases in inflation over the last several years,' Monks said. 'Food has gotten much more expensive. The price of eggs, chicken eggs, has gotten much more expensive.'
'It's frustrating, and our constituents are demanding that they see some kind of relief,' Monks added.
The nonpartisan Idaho Center for Fiscal Policy wrote that increasing the grocery tax credit to $155 per year would help working class families as grocery prices increase. For families making less than $31,100 per year – the lowest 20% of income groups in Idaho – the tax cut for increasing the grocery tax credit to $155 per year would correspond to about .22% of their annual income, according to the Idaho Center for Fiscal Policy.
Like the original bill, House Bill 231 also includes a provision that allows Idahoans to save and scan all of their grocery receipts and claim an itemized credit of up to $250 per year if they pay more than $155 per year in sales tax for groceries, Monks said.
On the other hand, Idahoans would not have to take any additional steps to claim the $155 credit under House Bill 231 – it would be applied automatically as a refundable credit, which means Idahoans can receive the benefit even if they don't owe any state income taxes.
During Thursday's hearing, Rep. John Gannon, D-Boise, made an unsuccessful effort to increase the amount of the grocery tax credit to $225 per year, but Monks called the change 'hostile' and Gannon's effort failed.
The new, preferred grocery tax credit bill, House Bill 231, likely heads next to the full Idaho House of Representatives for consideration.
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