Des Moines, Iowa — A state panel is predicting state tax collections for this budgeting year will fall two-point-seven percent below the last one.
Iowa Department of Revenue director Kraig Paulsen says tax cuts for retirees, corporations, and individuals in the top state tax bracket are what’s driving that negative number.
David Underwood, a CPA from Clear Lake, is another member of the Revenue Estimating Conference. Underwood says he’s heard from employers who have just about given up on trying to find employees — and that is limiting business growth in Iowa.
Holly Lyons of the Legislative Services Agency says while there are national economic headwinds, major indicators offer conflicting data.
Underwood says the state recovered quite rapidly from the economic freefall COVID caused in 2020.
Underwood says he wishes he had a more optimistic view of the state’s economy.
The last state fiscal year ended June 30th and state tax collections grew nearly 11-and-a-half percent during the 12-month period — far beyond officials’ predictions. Iowa’s gross domestic product declined slightly in March, April, and May. The governor’s top tax and budget advisor says that other economic measures indicate the economy’s boom cycle has slowed but is still in positive territory.
