Republicans in the Iowa House are proposing a 20% cut in the state income taxes individual Iowans pay.
Representative Erik Helland, a Republican from Johnston, says it would save Iowans an estimated $204 million next year.”The bottom line is this bill, moving forward, is our effort to put Iowans back in charge of their paychecks,” Helland says.
The bill cleared a three-member House subcommittee late this afternoon and during the subcommittee’s meeting, people who both supported and opposed the legislation had a chance to speak. Jan Laue of the Iowa Federation of Labor wondered how this more than $200 million reduction in state tax receipts would impact the state budget.
“You know, a lot of times folks try to compare the state budget to a family budget and if you go along those lines and you can’t pay your bills as it is, this is not the time to quit your job,” Laue said.
John Gilliland of the Iowa Association of Business and Industry told lawmakers over two-thirds of Iowa businesses are partnerships, limited liability companies or sole proprietorships and therefore pay individual income taxes.
“This piece of legislation directly puts money back into those small businesses so they can invest and grow and hire people and bring more Iowans back to work,” Gilliland said.
Victor Elias of the Iowa Child and Family Policy Center said with legislators contemplating deep cuts in state spending, a deeper reduction in taxes on top of that makes no sense.
“We’re going to be sacrificing the future of our children and the future of our economy on the altar of ‘tax cuts no matter what,'” Elias said.
The proposal will next be considered by the House Ways and Means Committee.