Hawkeye Reporter

Iowa State Director Matt Everson and John Hendrickson, policy director for Iowans for Tax Relief, have written an opinion piece published in the Corridor Business Journal. The article supports Governor Kim Reynolds' fiscal policy.

Their commentary references the May 2024 NFIB Small Business Economic Trends Survey, which highlights small business owners' concerns about the economy, tax, and regulatory policy. They attribute these worries to inflation and the fiscal policies of President Joe Biden. Everson and Hendrickson highlight that Governor Reynolds, along with Iowa legislators, is taking a different route by offering tax relief and reducing government regulations.

In the recent legislative session, lawmakers passed a significant income tax reduction. The Iowa tax code will see a change to a flat 3.8% income tax, which Senate Majority Leader Jack Whitver states will save Iowa families an average of $800 annually, equating to $1.3 billion remaining with working families.

Since 2018, under Governor Reynolds’ leadership, Iowa has seen progress in simplifying and reducing tax rates. Previously one of the highest in the nation, the top income tax rate was nearly 9% with a 12% corporate tax rate. Efforts have been made to moderate these rates.

The Legislature is also advancing taxpayer protections requiring a two-thirds majority vote to increase income tax and protecting the flat tax or single-rate income tax from being altered in the future. These measures aim to control spending and protect against potential tax hikes. Both resolutions need legislative approval to be included on the November 2026 ballot.

In addition, the Legislature is working on state government reforms through the reduction and consolidation of state boards and commissions.

Everson and Hendrickson argue that the real economic threat is from federal policies rather than state-level fiscal conservatism. They suggest that Iowa’s budgetary stability, seen in its $3.7 billion Taxpayer Relief Fund and surplus budgets, contrasts with the economic conditions caused by high federal spending.

They compare Iowa’s approach to the fiscal challenges faced by progressive states like California, Illinois, and Minnesota, questioning why these states encounter fiscal issues despite different policies.

The opinion piece concludes by contrasting President Biden’s administration, which they claim fosters uncertainty, with Governor Reynolds, who is depicted as offering policies that promote economic growth.