Iowa GOP, business in sync for taking on state tax revamp

Senate leader touts 'real relief,' not 'a moving of chairs on the deck'

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DES MOINES — Previewing a “chapter 2” of Republican priorities in the legislative session beginning next month, a Senate leader told business and economic executives Wednesday to expect efforts to enact “real tax relief” intended to make Iowa’s economy and workforce grow.

Senate Majority Leader Bill Dix, R-Shell Rock, was one of two ranking Republicans to tell the Iowa Chamber Alliance they expect lawmakers to address business and individual taxes while finding ways to bolster programs that enhance the skills of workers.

Dix said the tax efforts would go beyond “reform” to “relief.”

“Reform implies that it might be a moving of chairs on the deck and that’s not what we should be pursuing,” he told members of a coalition representing the 16 largest chambers of commerce and economic development organizations in Iowa. “We should be looking at how we become less reliant on the income tax and motivated by one reason and one reason only — to grow our economy and to have more taxpayers.

“It needs to be real tax relief that attracts and allows for more taxpayers and an increase in the tax base, and recognizes that money can walk,” the Senate leader added.

Rep. Jake Highfill, R-Johnston, said Republicans in the House and Senate will caucus on taxes and other issues after the Revenue Estimating Conference convenes Monday to set tax collection projections that will form the basis for budgeting in the session.

He said corporate and personal income taxes “are on the table” and right now “there are about 15 ideas out there on how to do it and how to get it done.”

While there are a lot of ideas on how to improve Iowa’s tax climate, the consistent theme in the discussions has been that “we’re going to have a real cut,” Highfill said. “I think the important thing is to make sure it’s a cut, make sure Iowans are fairly represented and have a lower tax bracket.”

He added: “I believe it’s going to happen. All the stars have aligned.”

The discussion came during a luncheon held after the alliance issued its priorities for the 2018 session — which also focused on meaningful tax reform, as well as continued support for economic development programs it sees as essential.

The alliance also advocated comprehensive investment in developing and retaining top-notch talent and a workforce through broad support of GOP Gov. Kim Reynolds’ Future Ready Iowa initiative that sets goals for education and training beyond high school; support for high-quality K-12 education to prepare graduates with career-ready skills or postsecondary education; strong “fiscal prudence and spending restraint” across government; long-term infrastructure planning and resources to fund critical projects; and predictable and responsive regulations.

“The 2018 legislative session will allow the Iowa Chamber Alliance the distinct opportunity to improve Iowa’s economic landscape,” said Chris McGowan, 2018 chair of the alliance and president of the Siouxland Chamber of Commerce. “This year the alliance will focus its efforts on improving Iowa’s overly complex and burdensome tax structure while advocating for the economic development tools we utilize to encourage capital investment, create quality jobs and wages and enhance our quality of life.”

Sen. Chaz Allen, D-Newton, who also participated in the legislative panel with Rep. Mary Gaskill, D-Ottumwa, stressed that a state’s tax code is among about nine elements prospective businesses look at when making site decisions.

At the top of the list is skilled labor, highway accessibility and quality of life for employees, Allen noted, in pushing for a balanced effort to promote growth, economic development and jobs.

The GOP emerged from the last election with control of the entire state lawmaking agenda for the first time in years. In the 2017 legislative session, lawmakers quickly enacted GOP priorities including restrictions on public sector collective bargaining and workers’ compensation.

The next legislative session begins Jan. 8.

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