Tempers flared as lawmakers from different parties and different sides of the state squared off on tax policy this week. Every fall, the Iowa Taxpayers Association hosts a roundtable with legislative leaders to discuss the upcoming session. Things got a little heated this year when lawmakers began discussing whether tax cuts spur economic growth. Representative Don Shoultz, a democrat from Waterloo, argued that the across-the-board tax cuts republicans seek don’t do the trick. Shoultz says when you give money back to all taxpayers, the money may or may not stay in Iowa, since you have no idea what people will do with their savings. Shoultz says cutting or eliminating the state inheritance tax poses the same problem, as one-third of the people who pay inheritance taxes do not live in Iowa. Shoultz says reducing the inheritance tax “does not help Iowa’s economy.” And Shoultz says those who push for more tax cuts ignore the already-existing list of tax breaks for businesses and individuals, as well as the “good” state taxes are doing around Iowa. But House Speaker Christopher Rants, a republican from Sioux City, strongly disagrees. Rants says Iowa’s taxes are too high, and make the state less attractive when compared to its neighbors.”No offense to those of you in eastern Iowa, central Iowa,” Rants began, then his voice rose to a shout. “You don’t have clue what it’s like to live in western Iowa.” “I don’t know who you’re competing with in Cedar Falls and Waterloo. I don’t know how many businesses are moving from Black Hawk County to Chickasaw County or to Worth County right next door,” Rants said. “All you have to do is come to northwest Iowa. Come visit the Dakota Dunes. Heck, come visit South Sioux City, Nebraska, and look at where the people are moving to and they’re not moving there for better schools. They’re moving there for economic reasons.” Rants says Iowa can’t put up a fence to keep people in, so policymakers must do more to react to the tax climates in neighboring states. Tax reform and tax cuts will be debated in the upcoming legislative session.
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