Tax Relief

Rozenboom helps tax break proposals | KNIA KRLS radio

This week Senate Republicans introduced a tax reform proposal that follows the original plans of Gov. Kim Reynolds and the Iowa House.

State Senator Ken Rozenboom says the upper chamber’s version aims to end up with a flat tax rate of 3.6 percent, opening the door to a potential abolition of the tax.

“If we can do that, our state income tax rate will be the fourth lowest income tax rate in the country, instead of the eighth highest as it is today,” he says. “Always remember that several states have no income taxes at all and we have to compete with them.”

The Senate proposal, similar to the governor’s plan, also eliminates all taxes on retirement income and offers farmers a first-time pension exemption by exempting income from cash rents or farm crop shares.

Democrats have argued that the measure could severely affect current revenue and funding levels, and that the cuts favor the wealthy and upper tax brackets, instead seeking tax breaks for Iowa’s middle class.

Iowa also has a corporate tax rate of nearly 10 percent, and Rozenboom says the Senate intends to eliminate some of the current exemptions and credits and eventually come to a lower corporate tax rate.

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