Kempthorne proposes Idaho sales tax raise to 6.5 percent to avoid service cuts

by Lacey Morrill
MOR01031@BYUI.EDU
News Editor

This decision is an effort to end a state budget crisis and produce sufficient resources for the 2003 fiscal year. The tax increase is expected to generate $18.4 million, Kempthorne said.

“We are not asking our citizens to pay more to expand government. We are asking them to participate in ensuring that we can meet the critical needs of the people of Idaho ... today and into the future,” Kempthorne said.

Last year, Idaho was ranked 20th in the nation with the sales tax rate set at 5 percent. Across the state, Kempthorne’s announcement that he plans to raise taxes has been met by mixed feelings.

Out of 486 people polled by the Idaho Statesman, 45.2 percent favor the tax increase. The remaining 54.8 percent would prefer to see more services cut. However, according to Kempthorne, Idaho has reached its limit on service reductions.

“While Idahoans recognize that problems and services have been reduced during these difficult times, they also recognize that the state has a fundamental responsibility to provide for both current and future needs in education, public safety and vital health care services,” Kempthorne said.

The tax increase is necessary because past budget reductions already failed to produce necessary funds, Kempthorne said. In last year’s budget plan, Kempthorne focused on reducing the size and cost of government spending. Despite his efforts, Idaho depleted virtually all reserve accounts in 2002.

“We are at a critical juncture in this state ... We can either move forward or we can fall victim to the national economy,” Kempthorne said. “This will require all of us to do some soul searching. But I’ll tell you the conclusion I ultimately came to. While personally uncomfortable, I truly believe this is in the best interest of the citizens we serve.”

Kempthorne promised the sales tax increase will expire in three years.