Idaho state budget’s revenue outlook improves for new fiscal year

Idaho state budget officials have an improved revenue outlook for the new fiscal year in a forecast released Monday. 

The Division of Financial Management revised its revenue forecast for Fiscal Year 2027, which began July1. The new forecast is just over $291.1 million, or 5.2% higher than what legislative budget writers predicted, according to the July Revenue Monitor report. 

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July, the first month of the current fiscal year, saw state revenues come in $13.1 million above the new forecast.

Individual income tax, sales tax and miscellaneous revenue all came in above the forecast. Corporate income tax collections were $15.9 million lower than projected, according to the report. 

Overall, July revenue was $5.6 million lower than the previous year, the report said. 

“If monthly revenue collections follow the new forecast exactly for the remainder of the year, the new projected ending balance is $619.5 million,” the report said. 

State agencies will submit their budget requests for next year at the beginning of September, and legislators will consider the requests during the 2027 legislative session.

Lawmakers will convene in January at the Capitol for the session. 

The revised forecast comes after state budget officials announced it ended the 2026 fiscal year with a positive cash balance, the Idaho Capital Sun reported.

Following years of tax cuts adopted by the Legislature, the state in 2026 cut budgets for nearly every state agency and program to avoid a projected shortfall. 

Gov. Brad Little’s budget chief, Lori Wolff, told agency leaders in May to continue to expect a tight budget environment as legislators set budgets next year, the Sun reported. 

She said the governor’s budget proposal will prioritize “revenue growth for non-discretionary spending and growth, increased costs in health insurance, and Change in Employee Compensation (CEC), fire suppression, and critical health, public safety and education costs.”