Republicans and all but five Democrats on the House panel that drafts tax policy have endorsed a 20-percent, across-the-board cut in state income taxes.
Representative Erik Helland, a Republican from Johnston, said 1.2 million Iowans would get a tax cut. “The economic ramifications are beneficial and dramatic,” Helland said. “…All of us agree that we’d like Iowans to keep more of their hard-earned dollars and this is a step in that direction and a step towards putting Iowans back to work.”
Representative Tom Sands, a Republican from Columbus Junction, is chairman of the House Ways and Means Committee and he touted the 100,000 business owners who’d see their taxes cut since they pay personal income taxes on their business profits.
“Get the money back into private business-individual’s hands so they can create jobs,” Sands said. “And that’s what benefits all of us here in the state is to have more people employed.”
Representative Roger Thomas, a Democrat from Elkader, is among the Democrats who voted for the proposal. In the 1990s, Thomas was serving in the House and he voted back then to cut the state income tax by 10 percent.
“And I think it was the right thing to do and I think this bill, you know, definitely goes in the right direction. It might help small businesses; it might not,” Thomas said during tonight’s meeting. “I think the middle class one that we offered I think probably could help there a little bit more.”
Democrats offered an alternative which would have cut income taxes by 40 percent for Iowans who earn between $20,000 and $250,000 a year. Those who earn more than a quarter million, or less than $20,000, would have seen a five percent income tax cut under the Democrats’ plan, which Republicans rejected.
Only one of the five Democrats who voted against the G.O.P. tax plan spoke out during the committee meeting. Representative Janet Petersen of Des Moines said the $204 million tax cut was more than three times as much as the cut Republicans intend to make in state support of preschool programs.