The Iowa House has voted to block a proposal that’d get rid of a tax agreement with Illinois and start collecting Iowa taxes from Illinois residents who work in the Hawkeye State. Illinois would then start collecting taxes from Iowans who work on the east side of the border. Democrat Representative Phil Wise of Keokuk hates the idea. He says he doesn’t want his constituents to have to file multiple tax forms.Under current law, the so-called “reciprocity agreement” with Illinois can be voided by officials in the Iowa Department of Revenue, Republican Representative Dave Millage of Bettendorf says legislators should make that decision. He says they’re elected to make the policy decisions, to enact taxes and collect revenue.But democrat Representative Don Shoultz of Waterloo argued legislators shouldn’t make the decision. He says the amendment is political because people along the river are afraid businesses there won’t support them for re-election.Governor Vilsack says the state of Iowa will collect about 16 million dollars from Illinois residents who work in Iowa if the reciprocity agreement ends.
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