BOISE - Legislation that would give retired U.S. military veterans in Idaho an estimated $3.5 million annual income tax break could attract North Idaho veterans currently living in Washington state, an Idaho veterans' services official said.

"Absolutely, correct," said Tamara Mackenthun.

Mackenthun, a deputy administrator at the Idaho Division of Veterans Services, was responding to an interview question Tuesday as to whether North Idaho would bring over more veterans from Washington to become Idaho residents if the tax break bill - House Bill 420 - becomes state law.

Washington currently doesn't tax the retirement benefits of retired military veterans, while Idaho does, Mackenthun said.

Mackenthun noted that the state's veterans' services division currently is in the preliminary stages of "looking at the possibility of maybe building another state veterans' home up in the Post Falls area."

The House Revenue and Taxation Committee on Tuesday advanced to the House floor on an 11-4 vote the tax break legislation sponsored by Rep. Kathleen Sims, R-Coeur d'Alene.

"This is not simply a show of support and gratitude for our military veterans, which is proper, but this is also about economic development for Idaho," Sims said in a prepared statement. "Not only will retiring veterans bring substantial income to the state, but many will continue on to new careers, bringing with them a wealth of technical, managerial and leadership skills to our state."

"These (military retirees) are very desirable employees that our businesses are looking for, and they must compete with these other states," Sims told the committee.

But HB420 received some strong opposition from Rep. Neil Anderson, R-Blackfoot, who argued that in a tight state budget year such as 2014, there's no room for a $3.5 million tax break for the veterans.

"We've got a pretty flat budget, a pretty tight budget," said Anderson, a member of the House Revenue and Taxation Committee. "So, if we take the $3.5 million off the back of one group of people, we need to put it on the back of another."