Des Moines, Iowa — Republicans in the Iowa House have passed their plan to shrink the personal income tax to a single rate of four percent and erase the state tax on retirement income.
It’s nearly identical to the plan Republican Governor Kim Reynolds unveiled in January, with the exception of her proposed reduction in the corporate income tax. Representative Lee Hein is a Republican from Monticello who leads the House tax policy committee.
House Democrats offered an array of alternatives, but each was rejected by Republicans, including the idea of altering the GOP’s tax rate reduction schedule — to speed up tax cuts for low and middle income Iowans. Representative Charlie McConkey, a Democrat from Council Bluffs, unsuccessfully argued that the Earned Income Tax Credit should be raised.
House Democratic Leader Jennifer Konfrst of Windsor Heights says the GOP tax proposal helps the wealthy.
Representative Dave Jacoby, a Democrat from Coralville, says the bill leaves out Iowans who are struggling to make ends meet.
House Republican Leader Matt Windschitl of Missouri Valley points to the state surplus — with an expected two BILLION dollars in a taxpayer relief fund by July.
Three Democrats joined with all the Republicans present to approve the House bill. House Speaker Pat Grassley says Wednesday’s vote shows tax relief is the number one priority for Republican legislators.
Senate Republicans have released their own, more expansive plan that includes a corporate tax reduction along with a mechanism that could ultimately wind the state income tax down to zero.
