State Incentives & Tax Overview

State Incentives

 Idaho State Tax Overview  
Property Tax Average 1.5%
Sales and Use Tax 6%
Tax on Services (telecommunication and utilities) None
 Local Option Sales Tax None
Inventory Tax None
 Corporate Income Tax 6.925%
Personal Income Tax 6.925% (top bracket)

All Businesses are Eligible for the Following:

3% Investment Tax Credit

On all new tangible personal property (machinery and equipment) with a carryover of 14 years OR a two-year exemption from all taxes on personal property on the qualified investment (can offset up to 50% of income tax liability

Personal Property Tax Exemption

On the first $100,000 of personal property, such as equipment and furnishings

5% Tax Research Credit

On qualified research expenses

Energy Conservation Rebates

Through efficient energy use up to $100,000 per year per site 

Companies may also qualify for consideration of the following
Idaho State Incentives and Tax Credits:

Tax Reimbursement Incentive

Companies who bring new value-added jobs to the state of Idaho may be eligible for a tax reimbursement of up to 30% of their payroll, sales and income taxes for a negotiated period of up to 15 years. To qualify, companies must create 50+ jobs in an urban setting or 20+ for rural with wage levels above the county average wage. Projects must be able to pass the “but-for” test (but for the incentive, the project would not have occurred).

Idaho Business Advantage

To qualify, a company must make a minimum $500,000 investment in new facilities and create at least 10 new jobs that pay at least $40,000 annually plus benefits, with additional jobs paying an average of $15.50 per hour during project period, may qualify for the following:

An enhanced investment tax credit of 3.75% up to $750,000 or 62.5% of corporate income tax liability in any one year.

A new jobs tax credit from $1,500-$3,000 for new jobs paying $24.04 per hour or more.

A 2.5% real property improvement corporate income tax credit up to $125,000 in any one year along with a 25% rebate on sales tax paid on construction materials for the new facilities.

Upon request of the business, the local county commissioners may also authorize a partial or full property tax exemption for up to 5 years.

Idaho Opportunity Fund

The Idaho Opportunity Fund (IOF) services as a “deal closing fund” to strengthen Idaho’s competitive ability to support expansion of existing Idaho businesses and recruit new companies to the state, ultimately creating new jobs and economic growth in Idaho.

Capital Investment Property Tax Exemption

Businesses that invest at least $3 million in new manufacturing facilities may receive a partial or full property tax exemption for up to 5 years from local county commissioners.

100% Sales Tax Exemption

Production Sales Tax Exemption on equipment and raw materials used directly in manufacturing, processing, mining, fabrication or logging operations; for clean rooms and semiconductor equipment manufacturing; and for equipment or material used in research activities. Processing materials, substances, or commodities for use as fuel for the production of energy are also exempt.

Utility and Industrial Fuels Sales Tax Exemption on utilities and industrial fuels such as power, water, natural gas and telephone.

Property Tax Exemption

Businesses that invest at least $3 million in new manufacturing facilities may receive a partial or full property tax exemption for up to 5 years from local county commissioners.

Workforce Development Training Fund

The Idaho Workforce Development Council offers Industry Sector Grants, Innovation Grants and Employer Grants.

Industry Sector Grants are designed to engage employers in developing new training solutions that address Idaho's workforce issues and fill skills gaps. The Idaho Workforce Development Council will accept Industry Sector Grant applications on a non-competitive, first come, first-served basis.

Innovation Grants can fund projects that address local workforce development needs. Projects may provide skills training to individuals and/or assist individuals with connecting to careers.

o New or enhanced training must address specific employer-identified skills gaps in the community; training cannot supplant or compete with current training opportunities.

o Training may include work-based learning opportunities, classroom training, or virtual training that addresses the skill gaps identified by employers in the community.

o Assisting individuals to connect to careers may include providing information and outreach on career education and workforce training opportunities and/or soft skill development.

Employer Grants are available to Idaho employers who are increasing their current workforce and/or retraining existing workers with skills necessary for specific economic opportunities or industrial expansion initiatives.

Outreach Projects: The Workforce Development Council’s Outreach Committee reviews and provides funding for proposals that will provide public information and outreach on career education and workforce training opportunities, including existing education and training programs and services not funded by the training fund. Funding is provided on a reimbursement basis. All Outreach Project Applications must be received at least seven days in advance of the next Outreach Committee meeting.  If you have questions, please contact Caty Solace at caty.solace@wdc.idaho.gov