Idaho revenue tops $4 billion
Hagadone News Network | July 15, 2020 1:22 PM
Increase builds upon $183 million surplus
The state released a yearly collection report that showed a promising bump in revenue from last year’s collections.
The Idaho Division of Financial Management reported $4.03 billion in revenue, about $70 million more than what state economists predicted. That $70 million, when coupled with a legislative surplus and trimmed department budgets across the board, leaves Idaho with around $183 million in surplus.
“Our revenue is up by 70 million this year,” said Alex Adams, budget chief in the Division of Financial Management. “At the same time, our spending was down: When the Legislature adjourned for the year, they left a $56 million surplus. On top of that, you saw departments cut their budgets; that really was across the board.”
Adams calculated that surplus, which rolls into next year’s budget, will give Idaho a huge financial boost next year.
“The new year started July 1,” he said. “We’re starting $183 million ahead, if you will.”
Individual income tax collections represented the lion’s share of collections once again. Idahoans paid $1.9 billion in state income tax, 7% higher than what was projected heading into 2019.
The additional income tax buffer this year came in part because state refunds were down to the tune of more than $100 million. Meanwhile, the second-biggest revenue driver — sales tax — eased down slightly from last year. The just-under $1.7 billion was less than 1 percent off of 2018’s collections.
Adams said the revenue could not have come at a better time.
“If you look at why we ended the year strong, we had really strong economic activity,” he said. “This year’s going to be a different story. We had record unemployment filings, and those coming back to work are seeing fewer hours than what they had before (the pandemic hit).”
Adams said early predictions show COVID taking anywhere from $350 million to $590 million from next year’s budget, or between 8.5 percent to 14.5 percent, adding that those projections will sharpen as the year continues.
“The surplus will definitely help some of that,” he said. “Idaho is better positioned than most states.”
He said some states are looking at 20 percent to 30 percent budget cuts.
“Because of the cuts Gov. Little has implemented, we’re in a much better position than some of the sister states around us and dealing with this,” Adams said.
The yearly report typically comes out around the end of April or beginning of May, but state tax collections for 2019 were postponed from their ritual April 15 deadline to June 15 after the coronavirus pandemic struck.
Little said at the time the ripple effects of the pandemic — including his stay-home order that shuttered businesses and sent a significant portion of the population in search of unemployment benefits — was too much of a burden on Idahoans to expect them to pay their taxes on time during an uncertain financial climate. As a result, he pushed the deadline to June 15.
The deadline for filing federal income taxes is July 15, this year, also extended because of COVID-19. The Idaho Constitution prohibits the government from continuing in debt, and because the state Legislature passed this year’s budget with the routine stipulation that the new fiscal year begins July 1, Little could not synchronize the state deadline with the federal deadline.