Local Option Sales Tax receives consideration
March 31, 2016
Members of a House Ways and Means subcommittee met Tuesday to consider House Study Bill 644. The bill would allow cities in certain "qualified counties" as defined by the bill where a local option sales tax is not currently in place, to self-determine whether to hold an election for the imposition of the tax, without the rest of the county. Provisions in the bill would require any new or amended sales tax implemented under the law to dedicate 50 percent to property tax relief.
The Iowa League of Cities requested an amendment that will exempt all other counties and cities from the requirement in the bill that 50 percent of new revenues be used for property tax relief. This would allow local governments to not change the percentage going to property tax at any future election for local option revenues.
The Iowa Retail Federation spoke in opposition to the legislation addressing issues with city boundaries and picking winners and losers. Cities in the affected counties were supportive of the legislation.