On Sept. 7, Reclaim Idaho withdrew Proposition 1 from the November ballot after the state Legislature passed House Bill 1 (HB 1) during its special legislative session on Sept. 1.
Proposition 1 qualified for the 2022 ballot on July 22. It would have increased the tax on income above $250,000 for individuals, trusts, and estates and above $500,000 for couples filing jointly to $16,097 plus 10.925%. It would have established the Quality Education Fund to collect the additional tax revenues to allocate toward public education.
HB 1 changes the income and corporate tax rates to one flat tax rate of 5.8%; provides a tax rebate equalling the greater of 10% of the taxes paid by a couple or individual in 2020 or $600 per joint filer or $300 for an individual; exempts the first $2,500 from taxation for single filers or $5,000 for joint filers; and allocates $410 million of the state’s sales tax revenue to the public school income fund and in-demand careers fund. The tax changes will take effect on January 3, 2023.
