Should Iowa Increase the State Sales Tax?

There is a movement afoot in Iowa to increase the state sales tax rate by one percent to raise revenue for the state’s natural resources. Back in 2010, Iowa voters decided that three-eighths of each penny added to the sales tax would go toward bettering the state’s natural resources.

Members of the Iowa Natural Resources Commission have called on Governor Terry Branstad (R) and state legislators to raise the rate during the current legislative session. The commission says approximately $150 million annually “from a dedicated portion of a state sales tax increase would provide more money to Iowa’s ‘woefully underfunded conservation, habitat and recreation initiatives’” (kcrg.com).

At least one lawmaker is open to a state sales tax rate increase. Pam Jochum, the Democratic Iowa Senate President, has said “she would support a three-eighths of one cent increase in Iowa’s sales tax for a state Natural Resources and Outdoor Recreation Trust Fund” (Des Moines Register).

Yet support for a rate increase is not widespread. It is said that the governor “doesn’t believe there is an appetite for a sales tax increase in the Iowa Legislature”, and he did not mention a rate increase during his Condition of the State address.

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photo credit: U.S. Fish and Wildlife Service - Midwest Region via photopin cc