Total net receipts YTD are 3.8% more than 2022, with growth in personal income tax, sales/use tax, and corporate income tax. Iowa’s revenue report for January has been released and the data revealed net General Fund revenue for the month was $0.1 million (0.1%) above the January 2022 net revenue level. When broken down by the three largest sources (personal income tax, […]
Total net receipts YTD are 4.8% more than 2021, with growth in personal income tax, sales/use tax, and corporate income tax. Iowa’s revenue report for December has been released and the data revealed net General Fund revenue for the month was $267.3 million (43.5%) above the December 2021 net revenue level. When broken down by the three largest sources (personal income tax, […]
As long as spending is under control, the state will continue to be in a strong fiscal position to provide the core government services Iowans expect while continuing to lower taxes and spur economic growth. The State Revenue Estimating Conference (REC) met on December 14, 2022, to evaluate the current (FY23) and next (FY24) fiscal years. December REC meetings are […]
The most recent Revenue Estimating Conference prediction is aligning with actual results. January results will provide an even better understanding of revenue trends. Iowa’s revenue report for November has been released and the data revealed net General Fund revenue for the month was $371.9 million (-38.8%) below the November 2021 net revenue level. When broken down by the three […]
Even with continued inflation, a national recession, and a workforce shortage, the state’s net General Fund revenue for the month was $198.6 million (32.7%) above October 2021. Iowa’s revenue report for October has been released and the news for the month continues to depict a positive fiscal situation heading into the holiday season. Even under the weight of continued inflation, […]
Continued strong revenue collections are evidence that tax cuts were justified in the state of Iowa; without them, the state government would have withdrawn more from the economy than necessary to support its services. The State Revenue Estimating Conference (REC) met in October to evaluate the current and next fiscal years, FY23 and FY24. Compared with its previous forecast in […]
Iowa has far exceeded expectations again, as the books are now officially closed on fiscal year 2022. Just over six months ago, Iowa budget experts on the Revenue Estimating Conference (REC) forecast state revenues to be 4.3% more than the previous fiscal year. However, the state ultimately brought in 8% ($717 million) more than last year, resulting in a budget surplus of $1.91 billion.
This is the second year in a row Iowa experienced a billion dollar surplus, as the state ended fiscal year 2021 with a $1.24 billion surplus. While income tax cuts have been phasing in since 2018, these figures provide even more confidence for the coming rounds of rate cuts and the exemption of retirement income scheduled for 2023.
Governor Kim Reynolds announced that Iowa’s budget will end Fiscal Year 2022 with a $1.91 billion surplus, which follows Fiscal Year 2021’s $1.24 billion surplus. Iowa’s financial position is due to prudent budgeting and fiscally conservative policies. Governor Reynolds and the legislature are demonstrating that their fiscal policies work to create a healthy economy and a strong financial foundation.
Kraig Paulsen, who serves as the Director of both the Departments of Management and Revenue, stated that “Iowa’s strong financial status again proves that we continue to over collect from Iowa taxpayers.” As a result, Governor Reynolds and the legislature have made it a priority to return the money back to taxpayers.
Iowa’s revenue report for August has been released and the news for the month was encouraging. Even under the weight of continued inflation and a national recession, the state’s net General Fund revenue was $57 million (6.5%) above the August 2021 net revenue level.
When broken down by the three largest sources of revenue-personal income tax, sales/use tax, and corporate income tax-each category demonstrated monthly growth over 2021 (directly from the LSA Revenue Memo):
Iowa’s historic tax reforms this year focused on lowering the income tax rates paid by Iowans and the companies that employ them. The next step needs to be changing who is – and is not – paying those taxes. If Governor Kim Reynolds and the legislature want to truly position Iowa for the future, it’s time to take on the state’s addiction to special tax breaks.
Given the Center for Disease Control’s (CDC’s) recent easing of its COVID-19 guidelines, the national public health emergency appears near its end. The technical end of this emergency declaration will signify that the pandemic is officially over. And while that development will be cause for celebration, it will also trigger a major event for state governments and citizens enrolled in Medicaid.
The first month of Iowa’s new fiscal year is now behind us. While looking at a single month is just one small slice of the pie, it might be hinting at some economic trends we are seeing nationwide. Record low unemployment could be resulting in higher than expected income tax payments, while fast growing inflation and a looming recession might be causing people to spend less of their money.
One topic that comes up frequently when we sit down with taxpayers across Iowa is the number of people our state government employs. Iowans intuitively understand that there are very real and significant costs shouldered by the state for each member of its workforce. For instance, the Legislative Services Agency reports in their most recent Factbook that Iowa spent over $1.5 billion in total compensation just three years ago, accounting for roughly 20% of that year’s state budget. And that doesn’t even count employees at the three regents universities*!
July 1 marks a very important date in the world of state government – the beginning of a new fiscal year. While the state has technically closed the books on fiscal year 2022, the accounting of funds is far from over and final numbers won’t be available until October. But no matter how 2022 is evaluated, Iowa is in a strong position moving forward.
The 2022 legislative session was historic for Iowa taxpayers. Nearly two months ago the legislature passed the largest tax relief measure in Iowa history, which was signed into law by Governor Kim Reynolds on March 1. What too many people overlook is that significant tax cuts like Iowa’s are only made possible by years of prudent and conservative budgeting.
Since 2018, Governor Reynolds and the legislature have placed an emphasis on passing tax reforms and restraining the growth of spending. This legislative session delivered the third (and largest) round of tax cuts yet, which was accompanied by a budget for Fiscal Year (FY) 2023 of $8.2 billion. This is a slight increase from the $8.1 billion FY 2022 budget and will likely mean yet another large budget surplus.
“One of the great mistakes is to judge policies and programs by their intentions rather than their results” – Milton Freedman
This quote hits home for many of us who care about public policy, and it applies most accurately to using our tax dollars to incentivize companies to do business in Iowa. Depending on one’s view of incentives, this can be thought of as economic development, or corporate welfare, or even crony capitalism. The reality is incentives are a tool used to compete in our global economy and literally every state in the nation has adopted some form of incentive program.
By John Hendrickson This past week we lost a champion of liberty with the passing of Bob Williams. Bob served as a state legislator from Washington and he founded two state policy think tanks, Evergreen Freedom Foundation and the Washington Policy Center. As a lawmaker and as a public policy professional, Bob Williams was a budget hawk and a defender […]
Let’s make something clear right away: Iowa’s state budget is going to continue to grow in the coming years. The only reason that point may be in question is Iowa’s Revenue Estimating Conference (REC), which has the difficult responsibility of estimating revenue for the state, recently released updated projections. The REC increased the current fiscal year (2022) estimate by 4.2 […]
This year is shaping up to be a big one for tax relief. From Mississippi to Kansas to Virginia to Iowa, elected officials are taking many paths to make taxes less burdensome, but they should all bear one thing in mind: without spending discipline, sound tax policy is impossible to maintain over the long term. Government officials at both the state and federal levels have been trying for years to tax and spend their way to fiscal success. This is no way to build a stable fiscal house. Luckily, some states this year are exploring the kinds of strong budgetary rules that create the conditions for prosperity.
The roadmap to tax reform begins with a prudent budget and that’s precisely what Governor Kim Reynolds is planning for Iowa. For Fiscal Year 2023, which begins this July, Governor Reynolds is proposing an $8.2 billion General Fund budget. That amount equates to an increase of nearly $100 million dollars in new state spending for the budget as a whole. […]
President Joe Biden and the tax and spend Democrats could learn a lesson from Governor Kim Reynolds. Iowa will end Fiscal Year 2021 with a $1.24 billion surplus. Last year, Iowa’s surplus was $305 million. Since assuming office Governor Reynolds has pursed a policy of prudent budgeting and pro-growth tax reform that has kept Iowa’s fiscal house in strong and […]
Time has passed Iowa’s tax credit system by, and the time has come for a change. Over the course of decades, a succession of governors and legislatures have built a giant structure of special tax credits, abatements and other forms of targeted tax breaks that turn a system intended to raise revenue to fund public services into a mechanism for […]
Image: Official White House Photos by Shealah Craighead and D. Myles Culle Iowa is a beacon of liberty against an onslaught of poor federal policies. President Biden has already proposed $6 trillion in new spending during his first 100 days in office. Iowa is awash with federal stimulus dollars. Iowa is frequently overlooked, but Governor Kim Reynolds is an example […]
Governor Kim Reynolds and the Republican-led legislature continued to follow fiscal conservatism. The legislature passed an $8.1 billion FY 2022 state budget. This budget is $290.7 million more than the FY 2021 budget. The $8.1 billion budget is over $4 million more than what Governor Reynolds originally proposed. Nevertheless, even as spending has slightly increased from the previous fiscal year, […]