Remember last year’s idea from Senate Republicans to erase state income taxes for young people in Iowa? That idea was abandoned. Now, House Republicans plan to push a big tax break for elderly Iowans. House Republican Leader Chuck Gipp of Decorah says a bill will be introduced today (Monday) in the House Ways and Means Committee that would phase out the income taxes now charged on Social Security and pension income.
Gipp says the people who invest in their communities and lead the fundraisers for churches, hospitals and community activities are leaving the state, and taking their wealth with them, because Iowa taxes their pensions and Social Security income. Gipp says retired people provide the start-up capital for entrepreneurs, and state tax policy is “chasing” wealthy retired people out of Iowa to low-tax states. “Other states are acknowledging that this Baby Boomer generation which is retiring is actually an asset rather than a liability. They want that wealth and spendable income in their states and are moving to do so,” Gipp says. “We need to do so as well and at the same time keep the entrepreneurial wealth in the state for start-up businesses.”
Gipp plans to have the full, 100-member House debate the tax break for retirees by the end of the month. “It’s an aggressive timeline, but we feel that strongly it’s that important an issue that we need to advance it as quickly as we can,” Gipp says. State officials estimate Iowans who get Social Security or pension checks pay over 242-million dollars in taxes to the state each year.
The 2006 Legislative session began in the Iowa House and Senate this (Monday) morning at 10 o’clock. “Welcome back to another edition of the Iowa General Assembly,” House Speaker Christopher Rants, a Republican from Sioux City, quipped to reporters gathered for a news conference. Senate Co-Leader Stewart Iverson, a Republican from Dows, is hinting that the 2006 session may find the two political parties at war on several issues. “We may have different ideas than our Democratic counterparts,” Iverson says.
One of those differences comes over the death penalty. Some Republicans in the Senate plan to push to reinstate capital punishment, but Senate Co-Leader Michael Gronstal, a Democrat from Council Bluffs, will again use his power to block Senate debate of a death penalty bill. Gronstal blocked debate of the death penalty last year. “Everyone in this building knows there aren’t the votes in the Senate, there aren’t the votes in the House to pass it and the governor wouldn’t sign it,” Gronstal says. Gronstal says the issues that divide Democrats and Republicans should be played out on the campaign trail, not during the Legislative session.