State GOP lawmakers are hailing the recent passage of a bill that overhauls the state?s income tax system.
Last week, the Iowa House and Senate reached an agreement on a tax bill that lowers the state?s income tax rate to 3.9%. Republican State Senator Mark Costello of Imogene told IARN affiliate KMA that the final bill was a good compromise between the rate favored by GOP lawmakers and the 4% favored by Governor Kim Reynolds.
“We have some surpluses, we have good revenue projections,” said Costello. “We think it’s a good opportunity to take advantage of that situation, and do some good things for Iowa taxpayers. Some people said, ‘oh, most of the tax breaks go to the rich.’ Everybody that pays taxes is getting a tax cut in this bill. Of course, if you pay more, you’re going to get more back.”
Republican State Representative Cecil Dolecheck of Mount Ayr says the tax bill also carries provisions preventing the state from exhausting its reserve funding.
“Within that package that we passed, if revenue does not reach 3.5.%, then we take money out of the Taxpayer Relief Fund, which automatically grows, so that we can guarantee that we have 3.5% growth in the state’s economy to be able to fund our priorities,” said Dolecheck. “That was one of the things that the Iowa House was very adamant upon, was making sure that we had sustainable revenues so that we could fund our priorities. That includes education, public safety, and those types of things, and transportation.”
Republican State Representative Tom Moore of Griswold says the tax reform package also contains components helping retirees and farmers.
?I think two of the bigger pieces in this, though, are the retirement income (tax), which is going away in 2023,” said Moore, “and, as well, the opportunities for farmers on when they retire to be able to sell their land, or have their capital gains be income tax free, or be able to use rental income income tax free. I think those are great pieces of it.”
Governor Kim Reynolds was expected to sign the bill into law prior to giving the Republican response to President Biden’s State of the Union address Tuesday night.
