Republicans in the Iowa House have voted to set up a new tax refund system for Iowans. Representative Peter Cownie, a Republican from West Des Moines, said any extra tax dollars that aren’t spent in the state budget should be sent back to taxpayers.

“In other words, once the legislature and the governor have agreed on a budget and once our reserve funds are filled, any money remaining is money the taxpayers have overpaid,” Cownie said.

The current state budget surplus is about $800 million. Republicans estimate each individual taxpayer would get a rebate of about 375 dollars next year if the bill becomes law. Future rebates would depend on how big the state budget surplus is — if there a surplus. Representative Tom Sands, a Republican from Wapello, said the proposal highlights a “fundamental” difference between the two political parties.

“We do need to ask ourselves a question and it’s a very fundamental question, but it’s a very simple question,” Sands said. “Who does the money belong to: the hard-working Iowans or government?”

The bill also sets up a new way to calculate state taxes. A “flat” tax of 4.5 percent would be charged on annual income — after just a couple of deductions. Representative Jo Oldson, a Democrat from Des Moines, said two-thirds of Iowa taxpayers won’t see their income taxes reduced under the plan.

“Those are good, hard-working Iowans, middle class people that are trying to make it day-to-day,” Oldson said. “And we’ve basically said to ’em: ‘Ah, don’t care about you.'”

The two tax proposals included in this bill are likely going to die in the Senate. Democrats who control the debate agenda in the Senate favor targeted tax cuts for low-income Iowans.

AUDIO of this afternoon’s 41-minute House debate on HF 478.