Idaho Sales Tax Revenues: Going Up???

Rep. Shirley Ringo (D-Moscow) is now proposing a reform plan for the Idaho Sales Tax. The plan reduces the sales tax rate from 6% to 5% but eliminates numerous exemptions and thereby broadens the base on which that tax is applied.

According to an Idaho Statesman article:

Their plan would retain the production exemption on sales of goods and equipment used by agriculture and other businesses and continue to exempt health care. But it would lift 21 exemptions and exceptions. The biggest hit would be felt in service industries, from lawyers and accountants to hair-stylists and auto repairmen. Other transactions subject to tax would include real estate commissions, construction materials, electricity and other utilities, transportation, trade-ins, lottery tickets and commercial aircraft.

The addition of the tax to many service industries is a significant change in the Idaho Sales Tax. Supporters of the plan believe that elimination of exemptions will raise $371 million of new revenue despite the fact that the actual rate is being lowered.

Additional commentary and analysis of this plan can be found at the Tax Foundation here.