The state’s plan to start charging cities and counties a fee for collecting local option sales taxes is under fire. A number of Iowa counties are charging an extra penny sales tax to finance school repairs. For years, the Department of Revenue and Finance collected the sales taxes and returned them to local governments, without charge. Now, a new state law lets the state charge a fee for that service. Sioux City Mayor Marty Dougherty is incredulous. He says we already pay taxes to run and the state government and shouldn’t have to pay again. Dougherty says legislators goofed in trying to tax people twice. House Republican Leader Christopher Rants of Sioux City says it is time to undo the new law.Rants says the state’s actually making money as it collects the sales taxes and holds the counties’ share for awhile while making interest on the money. Rants says charging to collect the tax sets a bad precedent.Joe Shannahan, Governor Tom Vilsack’s spokesman, says Rants and other legislators approved the new fee this past spring, so it’s up to them to fix it.
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