Two influential conservative groups are urging Iowa lawmakers to cut state and local taxes.
Iowans for Tax Relief president Chris Hagenow says it’s time to force city and county officials to cut or at least freeze property taxes. “Just this last year cities in aggregate grew their spending by 6.6% and counties by 7.6% and that’s just too much,” Hagenow says. “I understand that there are obligations that they have, but we all know because of the example we have set by the legislature that they can do better and so we think it’s appropriate to put some spending limitations in this year.”
Iowans for Tax Relief is proposing that yearly increases in city budgets be limited to two percent in the future. “I know that will be met with significant resistance,” Hagenow says, “but it’s time.”
Hagenow made his comments during an hour-long budget hearing hosted by Governor Kim Reynolds.
Some state funding was provided to cities and counties to offset cuts in local commercial property taxes that were ordered in a law Governor Terry Branstad signed in 2013. Hagenow argues lawmakers should not consider that kind of a tax shift again.
Taylor Raygor, state director of Americans for Prosperity, also spoke to Governor Kim Reynolds at last week’s state budget hearing and praised her signature on legislation that lowers Iowa’s personal income tax rate to 3.8% on January 1. “We look forward to working with you and legislative leaders to build on these successes by chipping away at our income tax until that burden is removed completely from the backs of hard working Iowans,” Raygor said. “Second, in order to do the first, we have to continue to prioritize spending discipline. While Iowa’s economy is strong, we know that government spending should not outpace the growth of our household incomes.”
Reynolds responded. “You can take to the bank that your priority one and priority two are continued priorities of mine as well,” Reynolds said. “We’re going to keep chipping away at this…and I’m excited about it.”
Reynolds has not shared details about her tax proposals for the 2025 legislative session, but she has previously said her goal is to completely eliminate the state income tax by the end of her current term as governor, which will be in early January of 2027.