Governor Signs Historic Tax Legislation
May 31, 2018
Wednesday in Hiawatha Gov. Reynolds signed the first income tax reduction and reform legislation in 20 years. In addition to income tax rate reduction and eventual elimination of federal deductibility if revenue targets are met, the legislation includes substantial changes to Iowa’s sales tax law. The bill modernizes items subject to sales tax and provides a mechanism for the state to capture increased revenue if the challenge to Quill Corp. v. North Dakota is overturned by the U.S. Supreme Court. Quill effectively prevents states from collecting sales tax on internet sales, unless the business has a physical presence in the state. Besides individual income tax cuts and sales tax changes, the legislation also includes a corporate rate reduction that will take effect in tax year 2021. To read the Governor’s release click here. For more information about the legislation, click here. ABI staff and members appreciated the opportunity to be present for the historic bill signing ceremony.