DES MOINES – Senate Republicans released the Iowa Working Families Tax Relief Act this morning, putting forward a bold policy aimed at rewarding work, encouraging investment, and giving job creators the confidence to create career opportunities for Iowans.
In total this bill provides Iowans $1 billion a year in tax relief. It lowers the taxes on Iowans by an average of $1000 annually. The top rate paid by many Iowans is 8.98 percent, the fourth highest in the country. The rate is 6.3 percent under this proposal, lowering the rates for most Iowans by 30 percent.
“The Iowa Working Families Tax Relief Act empowers Iowans to keep more of the money they earn,” said Senate Majority Leader Bill Dix, R-Shell Rock. “This money will boost the local economy and provide opportunities for Iowans to invest in retirement, save for college, or make important upgrades to the family home.”
Iowa has the highest corporate tax rate in the country at 12 percent. The Iowa Working Families Tax Relief Act lowers the tax rate on Iowa job creators, making Iowa much more competitive with other states in the Midwest. Announcements from companies large and small bring news of significant new investments in America.
With this lower, more competitive rate, Iowa will be best positioned to compete for these investments. This bill also aims to reduce and eliminate some of our state’s tax credits, a symptom of an uncompetitive tax code. Under this proposal, Iowa’s tax code will be more competitive and reduces the need for tax credits to favored industries, leveling the playing field for all businesses. The Iowa Working Families Tax Relief Act also permanently couples with federal tax changes, giving the agricultural economy a much needed boost and providing job creators the confidence to invest in Iowa.
“The time has come for Iowans to see true income tax relief,” Senate President Jack Whitver, R- Ankeny said. “This is real, meaningful reform coupled with a significant reduction – not just tinkering around the edges. Iowa families deserve to have more of their hard-earned money in their pockets.”
Finally, tax reform introduced by Senate Republicans dramatically simplifies the Iowa tax code by aligning state taxes with federal taxes. Providing clarity to taxpayers and job creators across the state makes Iowa one of the simplest states in the country to pay income tax and makes our state one of the most tax-friendly states in the nation.
“Working families in Iowa deserve big, bold tax relief,” said Senator Randy Feenstra, R-Hull. “I am proud to put forward a proposal that will make our state competitive with others in the nation and make Iowa known as one of the most tax-friendly. This is a proposal that offers a complete rewrite of a complex tax code, gives working families the largest tax cut in Iowa history, and encourages Iowans to invest in themselves and our state. This is the proposal hard-working Iowans deserve.”
Senator Pam Jochum of Dubuque, the lead Democrat in the Iowa Senate on tax issues, responded to the tax plan released today by Senate Republicans.
Although the proposal from the Senate Republicans leaves many unanswered questions, she says, Jochum provided this initial response:
“The tax plan offered by Senate Republicans today must be viewed in light of disastrous tax-cut plans approved in Kansas and Oklahoma, which have resulted in massive cuts to education, public safety and other vital services. In fact, Kansas abandoned failed trickle-down tax cuts and Oklahoma’s Republican Governor is actually proposing higher taxes to dig her state out a fiscal mess.”
Today, Jochum renewed her offer to work in a bipartisan manner on a tax plan that meets these principles:
Tax reform must be fair. Iowa’s tax system has a number of tax brackets in an attempt make the income tax system progressive so that those with lower incomes pay at lower rates. However, according to the Iowa Policy Project, when all state and local taxes are accounted for, Iowa’s lowest income earners pay the largest portion of their income in taxes. Changes to Iowa’s tax system should address this situation and not make this problem worse.
Tax reform must make Iowa’s tax code more transparent so Iowa can show its true competitiveness to the nation. Iowa’s tax code has become a confusing collection of credits, deductions and exemptions that has left the state with high tax rates that do not accurately reflect the cost of living and doing business in Iowa. Our tax rates appear to be among the highest in the nation — but according to the Tax Foundation, the amount paid by Iowans through our tax system ranks Iowa in the middle of the pack.
Tax reform needs to take into account our current budget situation. We just completed a legislative session where funding was slashed for nearly every part of state government, and there is no sign the situation will be improving next year. We must not repeat the mistakes of Kansas, which passed massive tax cuts that have resulted in a continual budget crisis where schools are underfunded and has forced the state to balance the budget by stealing from road funds and raising other taxes.
Tax reform needs to examine corporate tax credits. We have cut state funding for vital state programs that serve some of our youngest and most vulnerable Iowans. So far corporate tax credits have been exempt from these cuts. We must determine if these corporate tax credits a good return on the investment and benefit Iowans, not just those few businesses.
Here is the Republican plan:
http://northiowatoday.com/wp-content/uploads/2018/02/IowaWorkingFamiliesTaxReliefAct.pdf
You guys will all be crying when this big tax cuts makes it impossible for the LEOs of your area to do their jobs efficiently, the highway department to clear the roads of snow in a timely fashion, the DNR to patrol the lakes and rivers, the prisons become more dangerous as guards are laid off, and, among other things, mentally ill patients are not tended to because of cuts to Medicaid and state services.
Low taxes does not create economic development. In fact, the opposite is true.
Its fine if you want low taxes because you want to keep more of your money, but anyone who believes this tax cut would spur economic development should have their voting rights taken away.
Why is Pam Jochum identified both as a Democrat and, in the picture, as the senate president? Since the senate is in the hands of Republicans, Pam can’t be both a Democrat and the senate president.
thanks for fixing that.
The state can’t find the money to educate our youth, protect our waters, or inspect our nursing homes. Yet they want to give a tax cut? Like any household, if I was unable to pay the mortgage, save for retirement, or buy health insurance, my first response is to seek a pay cut? Geez, the Republicans are dumb.
Hey, there is to much money going to education now. They (the schools) don’t need more. Give it a break on that issue.
Iowa is actually doing a good job on the water issues. Where they fail is the Democrats protecting farmers, big hot lots, and anything they can to put money in the farmers pockets at the expense of the environment.
Democrats are stupid and greedy wanting tax, tax, and more tax money to buy votes so they can stay in power. I left the Democratic Party a few years back once I realized they only lied to the working man so they could get elected and do nothing for the good of the people.
Cut taxes and stop wasteful spending!
Roflmao.
“what ya gunna do”, lol
Canes 4 sale, lol
And the Iowa residents and the American public have ALWAYs been brain washed into thinking the the liberal Demopoops were for the private sector WORKING CLASS – MSM – CBS -NBC- CNN FAKE NEWS LIES. Wake up – TRUMPS a non politician and looking out for the working class unlike the demopoops and their FALSE promises . Mid Terms are coming up and we need MORE republicans in the house and senate to MAGA.
You’re an embarrassment to the human race.
Dumbass.
You awful touchy. You call everyone names because they love America. Where does all that hate come from in you?
Please seek help! The next election or any election is not going to cure your anger at the Presidents success.
Yes, Yes, Yes!
Vote yes for a tax cut!