Statewide, Iowa (RI) – A bill that’s cleared an Iowa Senate subcommittee would cut taxes that businesses pay to cover unemployment benefits when people get laid off from their jobs.
Governor Reynolds says Iowa’s Unemployment Trust Fund has too much money in it and she wants to provide more tax relief. Reynolds, who made the same proposal last year, is asking lawmakers to lower the top unemployment tax rate and reduce the taxable wage base by half.
Ryan Sempf with the Quad Cities Chamber of Commerce says the bill is an opportunity to improve Iowa’s competitiveness with neighboring states.
Peter Hird with the Iowa Federation of Labor says the bill won’t benefit working people.
The same bill stalled last year over concerns that the state might have to raise business taxes if there’s a recession and Iowa’s unemployment rate soars. This year a Senate Republican has proposed adding a surcharge on the bill for businesses that have seasonal layoffs, to cover the unemployment benefits workers from those businesses collect during the winter.
An Iowa Workforce Development official says that would cause a one-year delay in implementing the tax cuts for businesses.
