For the third time in the past 10 months, the Iowa Senate has endorsed the idea of increasing a tax credit for Iowa families that have an annual income of $45,000 or less.
Republican Governor Terry Branstad used his authority to veto similar proposals twice last year. Senator Joe Bolkcom, a Democrat from Iowa City, is the proposal’s chief proponent in the senate.
“I hope the third time’s the charm,” Bolkcom said. “I hope that the House will also quickly pass the working families tax cut and then let’s send it down to Governor Branstad with plenty of time to override his veto if he chooses again to veto a tax cut for…working Iowans.”
Governor Branstad said earlier this month he is open to the idea of increasing what’s called the “Earned Income Tax Credit” now — but only if it’s coupled with a broader plan to reduce property taxes. Senator Randy Feenstra, a Republican from Hull, expressed the same sentiments during senate debate.
“I mean, this is one piece and it’s wonderful that we’re passing it,” Feenstra said. “But I urge…my colleages to put together a full and comprehensive tax plan that we can get passed this year.”
Later this afternoon, Republicans in the Iowa House intend to debate a bill that would lower commercial property taxes and limit the growth of property taxes on homes and farms. Bolkcom, the Democrat who heads the senate’s tax-writing committee, is no fan of that proposal.
“In the House, they are voting on the biggest tax give-away to out-of-state corporations in the history of the state of Iowa,” Bolkcom said. “Here in the senate we are about to cut taxes for 260,000 working Iowa families, the families that are home to about 37 percent of all our kids.”
And Bolkcom is resisting any effort to tie all the tax proposals together into one package. “These two tax cuts are in no way related,” Bolkcom said. “Each should be and must stand on its own.”
Republicans in the House are proposing an eight-year plan to reduce commercial property taxes by 40 percent. The package also limits future growth in residential and agricultural property taxes and plugs more state money into K-12 public schools, an effort to reduce school districts’ reliance on property taxes.