
While Idaho lawmakers once again revisit the debate surrounding sales tax on Internet purchases, the Idaho State Tax Commission wants Idahoans to know that, unless things change, the so-called "use tax" is still due.
“The use tax has been a part of Idaho law since 1965, when the sales tax went into effect,” explained Randy Tilley, Idaho Tax Commission audit and collections administrator. “Every state with a sales tax also has a use tax, to make sure that all sales are taxed equally and fairly.”
While "use tax" is often overlooked by online retailers, Idaho State Tax Commission suggests it is consumers' responsibility to pay the extra funds after making purchases online. Idaho is not alone in the push to collect use taxes - New York and California recently started similar campaigns.
Tax analysts suggest that what once was only enforced on large-ticket items such as cars and boats, might soon be required for all Web purchases.
“The law does not exempt Internet purchases from tax,” Tilley stated. “When Idaho citizens make untaxed purchases online, it creates an uneven playing field for local businesses that have to charge tax on their sales.”
For online shoppers fearing an audit nightmare, the State Tax Commission lists three ways Idahoans can pay: on their annual income tax return, using a Form 850-U, or in person at the Tax Commission office.
Following a two-month investigation, Ada County prosecutors have determined that there is insufficient evidence to warrant criminal prosecution of former Idaho State Tax Commissioner Royce Chigbrow and other employees of the Idaho State Tax Commission. The investigation—which resulted in two separate reports of 36 and 27 pages—was launched in January following allegations that involved multiple criminal statutes, including the misuse of public funds.
Many of the complaints investigated concern what some view as inappropriate favorable settlements with taxpayers regarding the amount of tax owed. But an investigation by the Ada County Sheriff's Office uncovered no evidence that tax commission employees received benefits in exchange for favorable discretion in resolving tax disputes.
"The Ada County prosecuting attorney declines to charge former Commissioner Chigbrow or any other employee of the State Tax Commission with offenses pursuant to the complaint," read a statement by the prosecutor's office.
Idaho State Senator Robert Geddes (D-Soda Springs) has been tapped to chair the Idaho State Tax Commission.
What are Geddes' credentials to oversee the embattled tax commission? He has a degree in geology and is a nine-term State Senator. He's also a CPA.

Geddes' appointment comes with a significant bump in pay, moving from his $16,000 as a part-time Senator to $95,000 plus benefits for a full-time position on the tax commission.
"I'm pleased to accept this appointment and feel that my background and experience can benefit to ensure that the taxpayers and Tax Commission employees alike will be treated fairly and equitably," said Geddes.
As for who will replace Geddes in the senate, the Republican Legislative Committee for District 31, including Bear Lake, Caribou, Franklin, Teton and Bonneville counties, will nominate three possible successors. Otter will chose Geddes' replacement from among the nominees.
Right about the time that Dan John of the Idaho Tax Commission was briefing lawmakers on revenue projections for the coming year, his boss was resigning.
According to the Associated Press, Tax Commission Chairman Royce Chigbrow told Gov. C.L. "Butch" Otter that he was resigning "effective immediately."

Idaho House Speaker Lawerence Denney indicated that he supported a formal probe into the allegations and Ada County Prosecutor Greg Bower confirmed that his office was "looking into Chigbrow's actions."
In his resignation letter, Chigbrow said "unfortunately and perhaps unfairly, I have become the issue."
In accepting the resignation, Otter called Chigbrow, "my friend and trusted adviser for a number of years." "He was kind enough to enter the arena of public service at my request, and I applaud his hard work, knowledge and expertise in that role," said Otter. "I wish him all the best in his future endeavors. You can read the resignation letter here. chibrow_resign.pdfWord from the Guv's office this afternoon is that David Langhorst has been named to the Idaho State Tax Commission.
Langhorst, who has served in both houses of the state Legislature, made an unsuccessful run for Ada County commissioner last year against incumbent Rick Yzaguirre. Langhorst, who's a Democrat, replaces Colleen Grant and joins the bipartisan commission with Democrat Tom Katsilometes, and Republicans Royce Chigbrow, who serves as chairman, and Sam Haws, who serves as vice chairman.
Typically, news of tax commissioners is the kind of stuff that's about as interesting to the public at large as say ... well, anything to do with taxes. That is, it's a yawn maker. The Langhorst appointment is pretty noteworthy stuff, however, given that the the commission is still trying to shake off last year's scandal, in which the commission was accused of favoring big business with excessive tax breaks.
During his time in the Legislature, Langhorst cultivated a reputation for playing well on both sides of the partisan fence. Of his new job, Langhorst says he's looking forward to working with the commissioners "to achieve and maintain a fair, predictable and stable tax system for the people of Idaho.”
Here at citydesk, we'd be willing to bet whistle blower Stan Howland has a few pointers for Langhorst on how that can happen.
The Idaho State Tax Commission has beefed up its own internal rules for handling tax bill settlement agreements in the wake of a continuing non-scandal. Or semi-scandal.
As the Legislature waits on a full report of the Tax Commission's secret deal-making with companies that owe back taxes, tax commissioners met with their staff at a recent open meeting to approve a new internal policy.
citydesk was there, the only member of the public in the room, except for Senate Local Government and Taxation Committee Chairman Brent Hill, who is a CPA. So we were at a distinct disadvantage.
The new policy, written by Tax Commission attorney Ted Spangler and two other colleagues, lays out two overarching goals in deciding tax protests: to protect the taxpayer's rights and to resolve the differences between the taxpayer and the agency staff on the tax bill.
"It's not a mistake the order that they are listed in; we deliberately put the taxpayers rights to a fair and impartial review as the first one," Spangler told the commissioners.
Scroll down to read the new policy.
Last summer, one of the commission's senior auditors filed a whistleblower report alleging that commissioners regularly settle with out-of-state companies without any legal basis for lowering the tax amount.
The report led to a series of reviews of the settlement procedure, each of which exonerated the commissioners. A governor's review included several recommendations to the tax commission, including beefing up its policies.
One of the clarifications in the new policy is that on settlements exceeding $50,000, two commissioners are required to sign off. While this has been in writing for some time, it is not always followed.
Copies of two prior Tax Commission settlement policies show that in past years, three commissioners were required to review large settlements, and were able to file their concerns with the settlement, but that was changed in February 2008.
The legislative tax committees are still waiting to see a final report detailing each of the commission's settlements in the past year, a report that commission chairman Royce Chigbrow said is almost complete.
"We will address all of the points in the Gentry [report]," Chigbrow said, referring to the governor's review of the commission's settlement procedures. "This is only the start of our report to the Idaho Legislature."