Consumer spending in Iowa is driving state sales tax revenue higher. Over the past six months, there’s been a more than 10% increase in sales tax payments to the state.
The latest report of overall tax collections shows net state revenue grew 9.1% last month compared to December of 2020.
“In summary, Iowa net General Fund revenue contiuues to grow at a strong pace, with sales tax posting remarkable year-over-year gains,” Jeff Robinson, senior fiscal analyst for the Legislative Services Agency said. “Corporate income tax growth has moderated, but remains positive.”
Robinson said it’s likely there was a “modest gain” in the amount of personal income tax payments made to the state, however an accounting change made in mid-November makes a “precise” reading difficult. That’s because the Department of Revenue set up a single account on November 15 for depositing all tax payments made to the state and Robinson said it’s taking some time for payments to be separated and reported in each tax category.