Des Moines, Iowa — Republicans on a Senate subcommittee have advanced the governor’s bill to speed up state income tax cuts, provide a property tax cut for commercial child care centers, AND reduce the tax businesses pay into the state’s unemployment trust fund.
However, Senator Dan Dawson — the Republican who leads the Senate Ways and Means Committee — says those components are going to be considered as separate bills in the coming weeks — with his own bill to gradually eliminate the state income tax in the mix.
Governor Kim Reynolds has proposed lowering the state income tax retroactively to three-point-65 percent THIS year and to three-and-a-half percent next year. Molly Severn is the governor’s legislative liaison.
Money in the Taxpayer Relief Fund would be used to accomplish the governor’s immediate tax-cutting goals. Dawson has proposed investing that money and using the profits to gradually reduce the state income tax.
Senate Democratic Leader Pam Jochum says getting rid of the income tax benefits the wealthiest Iowans.
Jochum also opposes the plan to lower the taxes businesses pay into the state fund that’s used to cover unemployment checks.
Severn, from the governor’s office, says the governor’s proposal would lower businesses unemployment insurance taxes by 40 percent.
Severn says initial estimates indicate the tax break would save Iowa employers over 800 million dollars over five years.
