Get Educated

Stay up to date with email updates

'The Watchdog'

Help Iowans Keep Their Tax Cut!

posted on January 19, 2018

 

It appears legislators will tackle other issues before making the push for tax reform. The first priority will be to address the current fiscal year’s tight budget. State revenue in the form of tax collections continues to increase, but not as quickly as estimated. At least $30 million in spending for Fiscal Year 2018 must be cut mid-year to balance the current year’s budget. Senator Charles Schneider, chairman of the Senate Appropriations Committee, indicated he is working on a de-appropriation package made up of savings from state agency belt-tightening, spending cuts and “peeling back” unobligated tax credits or other transfers available to help balance the budget by June 30.

After addressing current year spending, legislators will turn to next year’s budget. This will most likely occur after the Revenue Estimating Conference meets in March. Because of previous overly optimistic revenue estimates and too much spending, Iowa had to use more than $100 million from reserve funds to balance 2017’s budget. At the time legislators committed to replenishing the funds this year, while Schneider said, “I’m expecting another tight year.”

When tax reform legislation will be introduced is not yet certain but elected officials continue to express their desire to improve Iowa’s tax climate. Rep. Guy Vander Linden, chairman of the House Ways and Means Committee, told the Iowa Association of Business and Industry his tax reform goals are to make the state more competitive for businesses, simplify taxes for all, and create a stable and predictable tax system.

“It’s got to be affordable for the taxpayer and the state,” Vander Linden said. “We can’t just do away with all taxes, but we don’t want to tax businesses and individuals to death.”

Lowering tax rates will not be easy, and this will require the legislature to address state spending. Last year, the Senate passed a constitutional amendment that would strengthen the 99 percent spending limitation. This amendment would have saved taxpayers close to $500 million since 2012. The Iowa House must pass the same resolution this year to complete step one of the amendment process. A prudent tax reform policy includes lowering spending to avoid deficits. Because of Iowa’s revenue situation, lower tax rates and spending reductions may have to be phased-in over a period of time.

 

Help Iowans Keep Their Tax Cut!

Because of federal tax law changes, most Iowans who get a cut in federal taxes will now have an increase in their state taxes. Some have called this a “windfall” for Iowa. This is NOT a windfall. All of those dollars must be returned to the taxpayer, not diverted to the state budget. If legislators do not address this issue, Iowa’s state government will consume the federal tax relief intended for you!

Speaker Linda Upmeyer recently said, “Those tax cuts were intended to remain with the hardworking taxpayers of Iowa.”

Contact your legislator and tell them to:

  1. Get federal tax cut dollars where they belong, into taxpayers’ pockets.
  2. Cut income tax rates and provide real tax relief for all Iowans.

Click here to find your legislator’s name and contact information.

 

Lowering tax rates and reducing spending is a formula that will lead to economic growth in Iowa. As legislation is considered at the Capitol in subcommittees, full committees, or on the floor of either Chamber, Iowans for Tax Relief will register for, against, or undecided on bills based on how the bill impacts Iowa taxpayers. Email itr@taxrelief.org to share your opinion. We welcome your input.

House File 633
An act relating to the shared operational functions for purposes of supplementary weighting for school districts

We believe the supplemental weighting encourages greater efficiency and serves the interest of the taxpayers.  This not only helps to save total education costs by having districts share resources but also helps more rural districts offer needed services for students.

ITR registered in support of this bill.

Senate Joint Resolution 9
A joint resolution proposing an amendment to the Constitution of the State of Iowa relating to the state budget by creating a state general fund expenditure limitation

ITR has long supported a spending limitation amendment. This amendment, if already in the Constitution, would have saved Iowa taxpayers close to $500 million since 2012. This spending limitation amendment is needed to help control the growth in state spending. Lower spending is necessary to achieve lower tax rates.

Senate passed SJR 9 in 2017 (referred to House Appropriations HJ 682)

ITR registered in support of this bill.

Senate Joint Resolution 8
A Joint Resolution applying for an Article V convention to propose amendments to the Constitution of the United States that impose fiscal restraints, and limit the power and jurisdiction of the federal government, and requesting Congress to similarly propose such amendments.

ITR has long supported a constitutional amendment to require the federal government to balance its budget and to limit the size and scope of government.

ITR registered in support of this bill.

Click here for a  complete list of legislation ITR is tracking during this legislative session.