NFIB 2021 Priorities Include Income and Property Tax Reform, Eliminating Inheritance Tax
NFIB, or the National Federation of Independent Business here in Iowa released its 2021 legislative priorities. NFIB has over 10,000 members in Iowa, nearly 300,000 members nationwide and a presence in all 50 states. A full 90% of NFIB Members have 20 employees or less and represent every industry from family farms to manufacturers to small-town store fronts. Small business owners are job creators who employ nearly 650,000 people in Iowa. Iowa’s legislative session began on January 11th. Here are NFIB’s top 2021 legislative priorities in Iowa:
Income Tax Reform:
- One of the top issues for NFIB small business members is Iowa’s burdensome tax code, specifically income tax rates.
- Despite the reforms implemented in 2018, Iowa still has one of the highest income-tax rates in the country.
- As small business begins to overcome the COVID-19 Pandemic of 2020, income tax reform is essential. It’s the best and most fair way to give every small business and their employees more of their hard-earned income while ensuring continued economic growth in Iowa.
NFIB is urging Iowa legislators to eliminate all triggers and implement the 2018 tax cuts immediately, couple the QBI and 179 expensing with federal code, and decrease the income tax rate to a maximum rate of 5%.
Eliminating Iowa’s Inheritance Tax:
- The beneficiary of a business or a family farm should not be penalized for the death of a previous owner.
- In Iowa, if a small business or family farm is left to an aunt/uncle, cousin, sibling, niece/nephew, business partner/friend, step grandchildren, or daughter/son-in law, they are forced to pay a 5- 15% tax.
- Most beneficiaries don’t have the liquid cash to pay these outrageous tax bills and either end up selling or closing the business.
NFIB is urging Iowa Legislators to eliminate the state’s inheritance tax to help preserve family farms and small businesses.
Property Tax Reform:
- Property taxes in Iowa are too high, uncompetitive with neighboring states, and have doubled in the last twenty years.
- Property taxes should only fund essential property services.
- Iowa is one of only a few states in the country that funds mental health through a property tax levy.
NFIB is urging Iowa Legislators to stop funding mental health services with property taxes and instead use the state’s general fund. This would provide immediate relief for ALL property taxpayers.
Medical Malpractice Reform
- In the past several years, Iowa has seen a substantial jump in high-dollar medical malpractice awards against physicians and facilities. In just five cases, Iowa juries awarded a total of $85 million in noneconomic damages.
- The trial attorneys have deployed new tactics to exploit Iowa’s current soft cap on noneconomic damages.
- These massive increases in costs are passed down to small business and their employees through higher healthcare costs and it is unsustainable.
- These added healthcare costs are resulting in reduced access to care (through closures of hospitals and clinics), particularly in rural Iowa, which limits the ability to grow and conduct business in those parts of the state.
NFIB is urging Iowa Legislators of ending the trend of outrageous exploitation of soft caps and enacting a hard cap on noneconomic damages. A hard cap would provide much needed cost relief for small business.