The Revenue Interim Committee and the HJ 35 Tax Study Committee met November 18-19 in Helena. The main goal of the HJ 35 Study Committee was to decide the scope of the HJ 35 study of state and local tax policy and the Revenue Interim Committee portion of the meeting focused on the agency monitoring and tax credit review functions of the committee.

The meeting included small group discussions addressing which tax issues to include in the HJ 35 study and possible solutions to the issues identified. The HJ 35 Study Committee then decided to focus the study on the adequacy of state and local revenue and the balance of taxes. Specifically, the committee will study the property tax, individual and corporate income taxes, and natural resource taxes. The study will also include consideration of a sales tax.

The Revenue Interim Committee portion of the meeting included agency updates from the Montana Tax Appeal Board and the Department of Revenue. The Montana Tax Appeal Board reported 250 active property appeals for the 2019 valuation cycle. The Department of Revenue provided a major case update and a report on the quality of the 2019 appraisal of residential and commercial property.

The November meeting was the first one at which the committee conducted its new required duty to review income tax credits. Staff presented information on the purpose, history, and usage of the foreign states tax credit and the new or expanded industry tax credit. The committee voted to recommend repealing the new or expanded industry tax credit and agreed by consensus to recommend retaining the foreign states tax credit but did not decide whether the credit should be scheduled for review in the future.

The HJ 35 Tax Study Committee will meet next on January 13 as part of Legislative Week. The Revenue Interim Committee will meet next on March 19-20. For more information, visit the committee’s website or contact committee staff, Megan Moore.

Committee Website: https://www.leg.mt.gov/committees/interim/2019rvic/
Committee Staff: memoore@mt.gov or 406-444-4496