A coalition of religious groups, child advocates, labor and environmental organizations is calling on legislators to end certain tax breaks for businesses. Governor Branstad has proposed a $200-million reduction in the state’s corporate income tax and Kelli Soyer of the “Coalition for a Better Iowa” says that’s the wrong approach because it provides another reward for big business that already aren’t paying their fair share.
“While we do have small businesses in this state that are Iowa-grown businesses that are paying their fair share, we have the big businesses that have their tax experts looking at the tax code to shift their dollars and their income tax out of Iowa, so they’re not paying Iowa income taxes,” Soyer says. As it did last year, the Coalition for a Better Iowa is pressing for an end to the research activities credit.
“Those are credits that are offered to companies to do research in this state that they’re already going to be doing anyway to strengthen their business,” Soyer says. “One of the things that’s happening with that is that while they get a credit for that, that is also a refundable credit. That wipes away their tax liability to the State of Iowa…We should not be doing this.”
Business groups argue the state benefits from the high-paying research jobs in companies like Rockwell Collins, Pioneer/DuPont and others that claim the research activities credit. The “Coalition for a Better Iowa” is also critical of Republican calls for deep reductions in state spending, curtailing state support of preschool, for example.
“As we continue to hear about the cuts that we have to continue to make, we say we don’t need to make those cuts,” Soyer says. The “Coalition for a Better Iowa” was formed in 2009 and it includes the Iowa Federation of Labor, the Iowa State Education Association and the Iowa Citizens Action Network.