DES MOINES, Iowa (AP) — A substantial property tax cut approved in Iowa two years ago has become a major expense for the state budget and views differ on whether this was a good investment.
The business-focused tax cut is costing the state budget about $260 million in the current fiscal year, both in tax credits and dollars to help replace lost local tax revenues. When he signed the bipartisan bill into law, Gov. Terry Branstad said this would make it easier for businesses to grow in Iowa.
But the expense was felt during budget negotiations in the spring. Democratic Sen. Joe Bolkcom, of Iowa City, said the cost of the tax cut affected Democratic spending priorities.
Branstad’s budget chief David Roederer called this an important investment.
