After a strong start to the 2018 legislative session, negotiations between the Iowa legislature and Gov. Kim Reynolds’ office have ramped up to successfully end the session, which is expected to happen this week.
Meanwhile, a tentative tax deal has been reached that would “provide Iowa individuals and small business owners $398 million in state income tax cuts in 2019,” reports the Des Moines Register.
Gov. Kim Reynolds started the year with an ambitious Condition of the State Address that proposed a reduction in rates by as a much as 23 percent. She also proposed a simplified state code, and lowered taxes for middle-class Iowans and small business owners, according to the Des Moines Register.
The House Republicans’ proposal would have cut individual state income taxes by about $1.3 billion over the next five years. The Senate Republicans have drafted a plan to reduce state individual income and corporate taxes by about $2 billion over the same period.
The Senate has also released a proposed general fund operating budget for the upcoming fiscal year that would total $7.48 billion; a 3.2 percent increase compared to current spending. The Senate plan is $5 million less than the House budget plan previously released, according to the Register.
“This historic state-level tax reform — coupled with tax reform at the federal level — will bring significant relief to working-class Iowans in a fiscally responsible fashion that will allow the state to meet its budget responsibilities in the future,” Reynolds said in a statement, according to the Register.
