Iowa Senate News Release
For Immediate Release: February 21, 2018
DES MOINES — Senator Pam Jochum of Dubuque, the lead Democrat in the Iowa Senate on tax issues, responded to a tax plan released today by Senate Republicans.
Although the proposal from the Senate Republicans leaves many unanswered questions, Jochum provided this initial response:
“The tax plan offered by Senate Republicans today must be viewed in light of disastrous tax-cut plans approved in Kansas and Oklahoma, which have resulted in massive cuts to education, public safety and other vital services. In fact, Kansas abandoned failed trickle-down tax cuts and Oklahoma’s Republican Governor is actually proposing higher taxes to dig her state out a fiscal mess.”
Today, Jochum renewed her offer to work in a bipartisan manner on a tax plan that meets these principles:
- Tax reform must be fair. Iowa’s tax system has a number of tax brackets in an attempt make the income tax system progressive so that those with lower incomes pay at lower rates. However, according to the Iowa Policy Project, when all state and local taxes are accounted for, Iowa’s lowest income earners pay the largest portion of their income in taxes. Changes to Iowa’s tax system should address this situation and not make this problem worse.
- Tax reform must make Iowa’s tax code more transparent so Iowa can show its true competitiveness to the nation. Iowa’s tax code has become a confusing collection of credits, deductions and exemptions that has left the state with high tax rates that do not accurately reflect the cost of living and doing business in Iowa. Our tax rates appear to be among the highest in the nation — but according to the Tax Foundation, the amount paid by Iowans through our tax system ranks Iowa in the middle of the pack.
- Tax reform needs to take into account our current budget situation. We just completed a legislative session where funding was slashed for nearly every part of state government, and there is no sign the situation will be improving next year. We must not repeat the mistakes of Kansas, which passed massive tax cuts that have resulted in a continual budget crisis where schools are underfunded and has forced the state to balance the budget by stealing from road funds and raising other taxes.
- Tax reform needs to examine corporate tax credits. We have cut state funding for vital state programs that serve some of our youngest and most vulnerable Iowans. So far corporate tax credits have been exempt from these cuts. We must determine if these corporate tax credits a good return on the investment and benefit Iowans, not just those few businesses.
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