Articles Tagged: Taxes

Over the past 12 months, Iowa net tax revenue has increased $750.3 million or 7.6 percent. That comes despite low levels of economic activity that occurred during the early months of the COVID-19 pandemic. Tax collections were helped by a recent surge in consumer spending due in part to pent-up demand and federal stimulus payments.

An amendment to a state Department of Revenue bill included the exemption, adding Iowa to what has become a nationwide movement to remove sales taxes on menstrual products and diapers.

TurboTax’s parent company will pay some $1.02 million to approximately 33,000 Iowans who were misled by the tax preparer, Iowa Attorney General Tom Miller’s office said Wednesday.

In Iowa, the average gas price Thursday was $3.924, but topped $4 in many rural areas according to AAA. However, Iowa lawmakers say they’ve heard little talk of suspending state motor fuel taxes -- 30 cents a gallon state tax on gas and ethanol, and 32.5 on diesel fuel.

As she has done in the run-up to formally starting to campaign, Gov. Reynolds contrasted her leadership to that of the Biden administrations and the Democratic Congress.

A look back at what’s been in the news in Iowa in the past week

Most Iowa workers would pay a 3.9 percent state income tax — a large reduction for the state’s highest wage earners and a modest decrease for low-income workers — under a new proposal that is likely to become law soon.

A proposal that would shift sales taxes in Iowa and, in the process, finally finance the state fund for conservation and water quality projects appears to be on life support at the Iowa Capitol.

Proposed income tax cuts are on the move, and work on the next state budget has started earlier than normal.

The bill, one of three GOP tax relief plans under consideration, would phase in a four-year gradual reduction in Iowa’s personal income tax rate from the current top rate of 8.53 percent for the highest wage earners to 4 percent for all taxpayers.

Similar to previous hearings, speakers on Monday were divided between those who said a flatter tax rate would make Iowa a more attractive place for businesses and employees, and those who said the plan benefits the wealthy while doing little to help lower-income workers.

As state lawmakers consider tax cuts, an Iowa senator claims, “Data has long shown the states with low or no income tax grow more quickly than states with high, punitive tax rates.” Academic consensus is less certain.

Gov. Kim Reynolds said Wednesday that “everything is on the table” when it comes to three competing tax plans that will ultimately have to become one.

The feedback from various business groups, conservative tax policy organizations, and water quality and environmental advocates was not unanimous, but certainly largely in support of Republican state legislators’ varied proposals to lower the state tax on income to a single rate; reduce the state tax on businesses; and create a shift in taxes that provides funding for the long-starved state fund for conservation and water quality projects.

Republican leaders in both the Senate and House have said they expect to move quickly on the legislative process for their respective plans, likely starting each next week.