If you are an activist group trying to convince Idahoans that our taxes are too high and need to be cut further, comparing Idaho's 5.3% income tax rate to Illinois' 4.95% is a pretty good way to do it. It makes for a good headline, and the number is technically true. But a better comparison would be how much Idahoans actually pay in taxes.
Rep. Ben Fuhriman
The Mountain States Policy Center is an organization that advocates for lower taxes and smaller government. Chris Cargill is its founder, president and CEO. Of course, an organization dedicated to lowering taxes is going to look for evidence supporting additional tax reductions. Mr. Cargill’s recent column attempted to convince us of just that.
However, if we are going to compare Idaho's income tax to Illinois' income tax, as Mr. Cargill chose to do, we should probably compare the whole thing. For 2026, Idaho provides a standard deduction of $16,100 for a single taxpayer and $32,200 for a married couple filing jointly. Idaho also does not apply its 5.3% rate to the first $9,622 of taxable income for a married couple. Illinois generally provides a personal exemption of $2,925 per taxpayer instead. That means the two states are not taxing the same amount of a person's income, and that makes a substantial difference in the amount someone actually pays.
Consider a married couple earning $100,000 a year. In Idaho, after the standard deduction and the portion of taxable income taxed at 0%, their state income-tax bill would be about $3,083. In Illinois, the same couple would pay about $4,660. That's about $1,577 more in Illinois, even though they have the lower stated tax rate. The Idaho married couple would have to earn roughly $633,000 a year before Illinois' 4.95% rate finally produces a lower income-tax bill than Idaho's 5.3% rate. But they aren’t done paying taxes yet.
Suppose they own a $500,000 home. According to the Tax Foundation, Idaho's effective property-tax rate on owner-occupied homes is approximately 0.50%. Illinois' is 1.88%. Applied to a home of the same value, that's roughly $2,500 a year in Idaho compared with $9,400 in Illinois.
Now let our couple go shopping. Idaho's state sales-tax rate is 6%. Illinois' state and local sales tax is about 8.98%. If they made $30,000 worth of purchases subject to those general sales-tax rates during the year, that's approximately $1,800 in Idaho versus $2,694 in Illinois.
Add just those three taxes together, and our hypothetical Idaho couple pays about $7,383. The comparable Illinois couple pays about $16,754 — more than twice as much. That isn't a complete accounting of every tax either family would pay, and the property and sales figures rely on statewide averages. But it certainly paints a very different picture than simply comparing 5.3% to 4.95%.
And there are still other taxes. Idaho's corporate income-tax rate is 5.3%. Illinois' combined corporate rate is 9.5%. Illinois also has an estate tax. Idaho does not. Perhaps the most interesting comparison comes from the Tax Foundation's own State Tax Competitiveness Index. Idaho ranks third nationally for property-tax competitiveness, eighth for sales taxes, 21st for corporate taxes and ninth overall. Illinois ranks 41st for property taxes, 37th for sales taxes, 42nd for corporate taxes and 38th overall.
Step back and look at the entire picture. Idaho has the ninth-most competitive tax structure in the country. Illinois ranks 38th. Yet the comparison chosen to make the case that Idaho's taxes are too high was the one headline number where Illinois happens to have the advantage: 4.95% versus 5.3%.
Both numbers are true. But one comparison by itself tells a very incomplete story. And that is the point. Public policy shouldn't begin with deciding we need a tax cut and then searching for the statistic that makes the case. That may be how advocacy works. It shouldn't be how governing works.
Idaho isn't Illinois.
Our property taxes are substantially lower. Our sales taxes are lower. Our corporate income tax is dramatically lower. Our overall tax system ranks among the 10 most competitive in America. And despite the headline rate, Idaho has the better income-tax deal for most working families.
We should continue looking for opportunities to make Idaho's tax system better. But before we make public policy based on a headline, let's be sure to use all the facts.




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