Republican lawmakers who just wrapped up the 2017 legislative session this past weekend already list “tax reform” as their top agenda item for 2018.
House Speaker Linda Upmeyer and other Republicans say they’re not ruling anything out at this point.
Republican Senator Randy Feenstra of Hull has been using computer models for the past few months to experiment with changes.
Iowa’s top tax rate for individual taxpayers is nearly nine percent.
But it’s not nine percent when compared to how taxes are calculated in other states.
That’s because Iowans get to deduct their federal income taxes from their income, before calculating how much they owe the State of Iowa.
For the first time in decades – at the urging of business groups – Republicans are seriously talking about getting rid of that deduction.
Senator Feenstra warns, though, that the deduction has to be phased out.
Senate Minority Leader Rob Hogg of Cedar Rapids says he and other Democrats are wary of the G-O-P’s talk about tax reform, but not yet ready to say “no.”
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Democrats point to Kansas, where Republicans enacted major tax cuts five years ago — and made 330-thousand small businesses exempt from taxes.
It has created huge state budget deficits and Kansas lawmakers are struggling to figure out how to fix things.
Feenstra says Republicans in Iowa do not intend to follow the Kansas playbook when it comes to tax policy.