Did You Pay Idaho Use Tax? Probably Not…

Emilie Ritter Saunders / StateImpact

Did you remember to include the use tax on your Idaho income tax form? Judging by the numbers, probably not. Idaho is one of 45 states that collects a use tax. But as NPR’s Planet Money reports, the vast majority of taxpayers don’t pay it.

There is one mistake, in particular, that lots of people made: They bought tax-free things online or in another state — and they failed to pay tax on their purchase in their home state.

It’s called a use tax. As far as I can tell, accountants and tax lawyers are some of the only people who pay it.

Forty-five states have a use tax. About 1.6 percent of the taxpayers in those 45 states actually pay the use tax. – NPR

In Idaho, that share of taxpayers is even less. According to the Idaho Tax Commission, just 1.36 percent of Idaho taxpayers paid the use tax last year.

The average amount that was self-reported on individual income tax returns was $56, the total dollar amount paid to Idaho was $536,026.

Connecticut Department of Revenue commission Kevin Sullivan told Planet Money most states don’t prosecute people who don’t pay the use tax…

But, he said, the expectation that taxpayers would voluntarily go through all the trouble of calculating what they owe is completely reasonable. In fact, he says, figuring out what you owe and paying your debt is the foundation of the US tax system.

But states seem to be abandoning the idea that people will pay the use tax. Instead, states are trying to force online retailers to collect sales tax. If they can do it, they could bring in an extra $11.4 billion a year. – NPR

The Idaho Legislature couldn’t muster enough support this year to streamline the tax. The Associated Press reports it’s the sixth straight year the Legislature has tried, and failed, to collect sales tax on Internet purchases.