January 23, 2018

Washington Examiner: New Tax Law Means Tax Hikes in Iowa Unless State Intervenes

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he timing is auspicious because, for years, some conservatives in the state have resisted the idea of eliminating the deduction out of a fear that doing so would be a tax increase. But such worries don’t apply now, because the federal tax cuts are lowering the deduction’s value to the tune of $130 million to $160 million a year, according to the Institute on Taxation and Economic Policy, a left-of-center think tank. …

Yet, the deduction wouldn’t simply be eliminated. Instead, it will be part of a larger tax reform package. And that is where liberals have reason not to fully endorse the idea. Meg Wiehe, deputy director for the Institute on Taxation and Economic Policy, said she favored ending the deduction. But she fears that the Iowa GOP will end up “blowing this opportunity and enacting some sort of change that results in Iowa losing revenue.” Read more