TAXATION – Amends and adds to existing law to expand the homestead property tax exemption, to increase the sales tax rate, and to direct sales tax revenue to taxing districts to replace property tax revenue lost from the homestead exemption expansion.

This bill expands Idaho's homestead property tax exemption to cover up to $125,000 of a home's market value or 50% of its value, whichever is less, for owner-occupied primary residences. To fund this expansion, the bill increases the state sales tax rate and directs the additional revenue to local taxing districts to offset property tax losses from the exemption. The legislation also establishes a new Homestead Property Tax Replacement Fund to manage the revenue shift and simplifies the application process by allowing homeowners to apply for the exemption only once if they continue to occupy the same property.