With a bit more than a month away from the end of the scheduled 2013 legislative session, House Republicans remain committed to focusing on ways to make Iowa strong. We laid out a plan to create certainty with balanced budgets and promote job creation through tax relief and reform.
Four budget principles have guided us this year, and remain the foundation of our work. We will not spend more money than the state takes in, we will not use one-time money to pay for on-going expenses, we will not intentionally underfund programs to balance the state’s budget and we will return unused tax dollars to Iowa’s taxpayers.
The need for broad-based property tax reform is clear. Iowa has the third highest commercial property taxes in the nation and the 16th highest residential property taxes in the nation. Iowans have sent the message that they want property tax reform and relief this year at the statehouse.
We remain committed to property tax relief for all classifications of property. We are open to considering any serious proposal, but any plan must be meaningful, inclusive and predictable.
The plan which is currently under consideration meets these goals. Our plan holds harmless property taxpayers anytime the state sets allowable growth funding and eliminates additional property tax levies associated with allowable growth funding, reducing the share of money that is put on the backs of Iowa property taxpayers.
On average, the state funding of local school aid property taxes would save Iowans $2.70 per $1,000 in property valuation when fully implemented.
I am also hopeful that the Senate will take action on our optional flat income tax plan. This bill gives Iowans a choice between the current system or a 4.5 percent flat tax with zero deductions or credits. The bill also raises the filing threshold so that the first $6,235 or $12,450 for married couples would not be taxed.
Under this alternative flax tax plan not one single Iowan will pay higher income taxes. This plan makes Iowa’s tax system simpler, flatter and fairer.
We will continue to hold the line on government spending and demand a budget that is honest, transparent and balanced. Because of our success in fiscal responsibility, we are also now in a position to provide meaningful tax relief to Iowans, while fully funding our core obligations and commitments