Governor Terry Branstad says he could go along with House Republicans’ plan to extend $95 million in state tax breaks to Iowa small business owners and farmers who purchased assets in 2015.
“It will be tight and it will use up a lot of the surplus over and above what we have in the economic and cash emergency account,” Branstad says, “but we could accept for one year.”
Branstad did not include this recommendation in the plans he submitted to legislators in January. Republicans in the House have voted to make this tax break available to about 177,000 Iowa small business owners and farmers who’re filing their taxes right now and the Republicans in the legislature would like to make it permanent, but Branstad says he’ll only accept a one-year extension.
“We’d lose too much revenue,” Branstad says, “and it would put us in a financial position that we couldn’t sustain it for the long term.”
The tax break under discussion is a credit for the depreciation of assets and would be available to small business owners and farmers who buy things like computer software, machinery, equipment and on-farm storage structures. State officials in the past several years have aligned state tax law with federal tax policy in this area. The leader of Democrats in the Iowa Senate says there are private discussions among key legislators to determine what might be possible this year.
Governor Branstad made his comments during taping of the Iowa Public TV program “Iowa Press” which airs tonight at 7:30.