ABI Takes Second Pass at Department of Revenue Proposed Rule Expanding Tax Liability under “Consumable Foods” Statute

July 9, 2021

ABI public policy staff, on behalf of affected member taxpayers, continues to object to the Department of Revenue’s proposed interpretation of the term “marketable food products for human consumption.” The Department has already held one hearing and another hearing took place before the Legislature’s Administrative Rules Review Committee. At the request of the Governor’s office, that process began again, and on Thursday, July 8, 2021, the Department held a second hearing. The Legislature’s Administrative Rules Review Committee will hold a second hearing next Tuesday, July 13, 2021.

Thursday’s testimony by ABI public policy staff reiterated ABI's position that the proposed Department rule expands tax liability for affected taxpayers beyond the scope of the Iowa Code as it was first adopted in 1985. At the hearing, ABI public policy staff also communicated that meetings have been held with the Department and with the Governor’s office. The parties will now develop language that reflects the taxpayers’ interpretation of the Iowa Code based on common practice and past experience with the law. This language will then be brought to the legislature for consideration and adoption.