Iowa’s tax structure has long favored the wealthiest Iowans and corporations, and tax cuts passed in 2022 are making inequities worse. The average millionaire will see a cut of $62,000 a year. In the middle, Iowans earning $40,000 to $60,000 will see an average cut of $300, or about $6 a week. Most with incomes under $40,000 will see no cut at all.
The eventual consequences will be cuts to services that make Iowa a good place to live, work and raise a family: schools, health, human services, public safety, child care and environmental protection. By FY 2028 official estimates put the cost at $1.9 billion a year, or over 20 percent of the general fund for FY 2022.
Senate and House proposals to eliminate the income tax — 43% of the Governor’s proposed General Fund budget and 50% of it before the new cuts passed — are alive right now.
