To be fully engaged in our governance, we need to be able to evaluate the level and value of service we receive for the taxes we pay. One of the ways to do this is with budget transparency resources like Transparent Idaho and Washington State Fiscal Information. Spending details, however, are only part of the equation. Meaningful transparency on the amount of taxes we pay and to whom is often the missing component.
Consider just how many taxing districts (entities with the authority to impose taxes) there are in each of the Mountain States:
Idaho’s Controller’s Office says there are a minimum of 1,261 taxing districts in the state;
Montana’s Department of Revenue reports there are nearly 1,400 taxing districts in the state;
Washington’s Department of Revenue says there are approximately 1,800 taxing districts in the state; and
Wyoming’s Department of Revenue reports there are more than 600 taxing districts in the state.
This means the typical home and business in these states could be subject to numerous taxing districts at the same time. The ability to hold the appropriate level of government accountable for that tax burden means knowing how much of the total tax bill they are responsible for and if the cost is worth the level and quality of service provided.
Now imagine if you could go to a tax transparency website and enter your home or business address to quickly see all the taxing districts you are subject to, at what rates, and perhaps be provided an educational calculator on your total estimated tax liability based on where you live.
One state is already moving in this direction.
Lawmakers in Washington State this year adopted a budget proviso “to develop an implementation plan for an online searchable database of all taxes and tax rates in the state for each taxing district.”
The Washington State tax transparency website budget proviso is modeled after the requirements from a bipartisan 2023 bill. Here is the intent section from that bill: SB 5158 - Concerning transparency in state and local taxation:
“The intent of the legislature is to make state and local tax revenue as open, transparent, and publicly accessible as is feasible. Increasing the ease of public access to state and local tax information significantly contributes to governmental accountability, public participation, and open government; this is particularly true when the information is currently available from disparate government sources, but is difficult for the public to collect and efficiently aggregate.”
The idea for a state tax transparency website is a long-standing recommendation from our friends at the Washington Policy Center.
Idaho State Controller Brandon Woolf is currently working to add tax data for taxing districts to the Transparent Idaho website. Controller Woolf told me:
"Our citizens' taxes represent their financial trust in our governance. They deserve full visibility into every dollar. We are proudly partnering with the multitude of taxing districts across Idaho to make financial data readily accessible to our citizens. Tax transparency is not just a commitment; it's a solemn obligation of a government accountable to its people."
U.S. Supreme Court Justice Oliver Wendell Holmes, Jr, once noted, “Taxes are the price we pay for a civilized society.” Civilization, however, need not be shrouded in the mystery of compounding tax districts without meaningful transparency.
We are hopeful that policymakers in the Mountain States will remove the mystery surrounding taxation by adopting a tax transparency website.