A panel of budget experts predicts state tax collections will grow by nearly five percent next year — and lower gas prices may help fuel that increase. Iowa Department of Management director Dave Roederer is one of three members of the state Revenue Estimating Conference.
“We know that for the most part apart other than on ethanol that lower gas prices do help our agricultural economy as well as other parts of our economy,” Roederer says.
Holly Lyons, the director of the Legislative Services Agency, is also on the state Revenue Estimating Conference. She says savings at the pump could translate into higher tax collections, depending on how consumers react.
“That theoretically means consumers will have more disposable income but it remains to be seen if they spend it on retails sales or other tax revenue generating investments,” Lyons says.
In the current year, the panel predicts state tax collections will amount to just under $7 billion. In the following budgeting year, their prediction is that the state will collect over $7 billion in taxes. However, that extra money may not quite match all the promises legislators made in the past to boost spending on education reform and property tax relief.