BOISE -- The Idaho House passed a bill Tuesday that would have a major impact on your property taxes.
The legislation would cap the state's homeowner property tax exemption at $100,000.
This is actually the second time that this exemption cap bill has passed through the House. The first time was in 2013, but back then it was not heard in the Senate.
Supporters say they hope to bring predictability to taxpayers, but those opposed to the bill say the only predictable thing about this bill is tax hikes.
“For those areas that are affected this is not good, not good legislation,” said Rep. John Gannon, D-Boise.
Representatives voted 55-15 Tuesday in favor of legislation that would cap the maximum homeowner tax exemption at $100,000, but not before lawmakers debated the proposal.
“I think the big concern is that those who have homes valued at $200,000 in the future will not get the benefit of any increased homeowner’s exemption,” said Rep. John Gannon, D-Boise.
“With the indexing what we did was we created tax shifting that was not overseen by the legislature,” said Rep. Janet Trujillo, R-Idaho Falls. “The tax amounts are constantly changing. This helps level that out and it makes the whole system better for everyone.”
Gannon says setting a fixed exemption rate actually hurts homeowners in the end.
“Without the inflation index continuing past $100,000 mark those who own homes that are $200,000, or are going to become worth that, will have a tax hike,” said Gannon.
Gannon says that under the current index, if the value of your home increases 10 percent, so too does your exemption value. The fixed rate in this bill would not adjust with inflation.
“The only predictability it brings is that if your house is worth more than $200,000 you're not going to get an increase in the homeowner’s exemption,” said Gannon.
“Throughout the state we have a long ways before these home values, actually, our homeowners get to see the full value at $100,000,” said Trujilla.
But Gannon worries about his constituents in Ada County where home values are on the rise.
"I think middle class families and middle class homeowners, and they're going to have a tax hike,” he said.
Right now, state law allows homeowners to claim an exemption for up to 50 percent of their home value.
Under this bill, anyone with a house worth more than $200,000 will only be able to claim a maximum of $100,000 in tax exemption.
The bill is now headed to the Senate.