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Specifically, the Rule states that if the maintenance contract is optional to the purchaser of canned software, then the portion of the contract fee representing upgrades or new software is subject to sales tax if the fees are separately-stated. If the fees are not separately-stated, 50% of the charge for the maintenance contract is subject to sales tax. The gross sales price for maintenance contracts required as a condition of the sale, lease, or rental of canned software, continue to be subject to tax whether or not the charge for the maintenance contract is separately- stated from the charge for software. Additional rules and regulations apply. (Rule, Idaho State Tax Commission, effective March 30, 2007


Work completed at a manufacturing plant was deemed subject to Idaho sales and use taxes because the work was an enhancement to real estate. The taxpayer was considered a real property contractor and, therefore, all materials purchased for incorporation into the real property would be subject to tax at the time purchased. (Decision No. 19969, Idaho State Tax Commission, July 30, 2007, received November 2007)


A developer who provides qualifying transportation improvements may claim a rebate of 60% of Idaho sales or use tax taxes. To be eligible for the refund, the developer must: build a complex worth a minimum $4 million and spend at least $8 million for the installation of certain highway/freeway improvements. Once these requirements are met, the developer may claim a rebate by filing a refund request for taxes collected by stores in the complex. All refund requests must be filed within two years of the developer's last expenses made on the transportation improvement and no interest will be paid on the refunds. (H.B. 250, Laws 2007, effective July 1, 2007)


On August 31, 2006, Governor James E. Risch signed the Property Tax Relief Act. The measure retroactively reduces property taxes to January 1, 2006, offset by an increase in the state’s sales and use tax rate from 5% to 6%, effective October 1, 2006. Additionally, the measure provides for an advisory question to appear on the November 2006 ballot that asks voters to approve these changes. (2006 ID H 1)


As the result of an Executive Order signed by Governor Dirk Kempthorne on July 29, 2005, Idaho officially supports the mission of the Streamlined Sales Tax Project, joining as a participating state. This action entitles Idaho to vote on issues before the SSTP and analyze and recommend sales tax simplifications cited in the SSTP Agreement (Executive Order No. 2005-09, Office of the Governor, signed July 29, 2005).



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