The Iowa Supreme Court has thrown a huge monkey-wrench in the Iowa budget picture by issuing a ruling that could cost the state millions of dollars. The state’s high court ruled the state of Iowa cannot tax race track casinos at a rate that’s higher than the tax rate for riverboat casinos. Last year, the U.S. Supreme Court ruled 9-0 in favor of the Iowa Legislature’s ability to establish the current taxing structure for riverboats and tracks. But in a ruling released this morning, the Iowa Supreme Court said the federal decision is “persuasive but not binding” in this instance. The Iowa justices said the two-tiered tax rate on gambling revenue was “irrational” and declared it “invalid” under the Iowa Constitution. The U.S. Supreme Court’s rubber stamp for the two-tiered gambling tax system was based on the U.S. Constitution. In its opinion, the state supreme court justices called their decision “difficult.”
