• About Us
  • Advertise
  • Contact Us
  • Privacy Policy
Friday, March 24, 2023
The Iowa Torch
  • Home
  • State Government
  • Federal Government
  • Local Government
  • Politics
  • Education
  • Opinion
No Result
View All Result
  • Home
  • State Government
  • Federal Government
  • Local Government
  • Politics
  • Education
  • Opinion
The Iowa Torch
The Iowa Torch
No Result
View All Result
Home Opinion

Hendrickson: Iowa’s Conservative Budgeting and Pro-Growth Tax Policy Works

John Hendrickson: Fiscal conservatism is working in Iowa and a $1.24 billion surplus is evidence that keeping spending low and reducing tax rates leads to economic prosperity.

John HendricksonbyJohn Hendrickson
September 28, 2021
in Opinion
Reading Time: 3 mins read

Photo by Shane Vander Hart

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 stable condition, while providing for the priorities of government. 

RELATED POSTS

Sherman: Iowa can fight back against the Biden Administration’s attack on retirees and families

Hendrickson: Iowa’s fiscal foundation is solid

Feenstra: Delivering a strong Farm Bill for Iowa

Truth in Accounting, which has recently released their Financial State of the States 2021 report ranks Iowa in the top 10 (9 out of 50) of fiscally stable states. Iowa’s economy has recovered from the pandemic triggered downturn because of Governor Reynolds and the Republican legislature following a policy of fiscal conservatism. Even heading into the pandemic, Iowa’s fiscal house was in order thanks to prudent budgeting. As the 2021 legislative session began, Iowa had a budget surplus.

In addition, to a $1.24 billion surplus there is plenty of money available in the reserves, including a combined $817.9 million in the Cash Reserve fund and the Economic Emergency fund and $1.054 billion in the Taxpayer Relief fund. By following fiscal conservatism, Iowa’s economy was not only prepared for the economic emergency, but it allowed the state to recover quickly. Governor Reynolds and the Republican legislature have not only kept spending in check, but they have enacted pro-growth tax reforms. 

ADVERTISEMENT

In 2018, the legislature passed a comprehensive tax reform measure that began to lower both the individual and corporate income tax rates. The legislation also broadened the sales tax base, which helped lead to better-than-expected sales tax revenues during the pandemic. 

Iowa was one of 11 states that enacted tax reform this year. A crucial component of the 2021 tax reform law, besides phasing out the inheritance tax, was eliminating the income tax triggers that were put in place in 2018 to lower the income tax. Now that the triggers are to be eliminated in 2023, the top rate will fall to 6.5 percent, and the individual income tax brackets will condense from nine to four brackets with a bottom rate of 4.4 percent. 

In 2022, the Iowa legislature will have an opportunity to build on previous tax reforms. Priority should be placed on lowering the individual and corporate income tax and addressing high property taxes. When signing the 2021 tax reform bill into law Governor Reynolds stated  “we are not done yet. Next year, I’ll be proposing additional income tax cuts as we continue to make Iowa the most attractive place in America to open a business, raise a family, and start a career.” 

Governor Reynolds has even stated that the ultimate goal is to eliminate Iowa’s income tax. Governor Reynolds understands that Iowa is in competition with other states for both jobs and people. Iowa cannot become complacent as other states lower tax rates. The 2022 legislative session will be an opportunity for Governor Reynolds and the Republican legislature to enact pro-growth tax reforms that lowers income tax rates. 

Fiscal conservatism is working in Iowa and a $1.24 billion surplus is evidence that keeping spending low and reducing tax rates leads to economic prosperity. Policymakers in Iowa should work to ensure that Iowa taxpayers have additional tax relief in 2022. 

Iowa can look to states such as North Carolina, Indiana, among others that have successfully reduced tax rates. Spending is at the heart of tax policy and if policymakers continue to keep spending low, Iowa taxpayers should see greater tax relief. 

The Des Moines Register released a new poll that shows a 53 percent job approval rating for Governor Kim Reynolds. Governor Reynolds approval rating is even higher, 57 percent, when asked how she has handled Iowa’s economy. The poll affirms that Iowa supports the conservative pro-growth policy agenda that Governor Reynolds is advancing in Iowa. Governor Reynolds understands that you cannot tax and spend your way to prosperity. 

Tags: 2021 Iowa Legislative Session89th General Assemblyfiscal conservatismfiscal policyIowa LegislatureIowa tax policyKim Reynolds
ShareTweetShare
ADVERTISEMENT
Previous Post

Hinson Introduces Back to Work Act

Next Post

Iowa Ranks 9th Nationally for Fiscal Health

John Hendrickson

John Hendrickson

John Hendrickson is the Policy Director for TEF Iowa.

Related Posts

State Government

Reynolds signs two bills addressing transgender children

March 23, 2023
Opinion

Hendrickson: Iowa’s fiscal foundation is solid

March 22, 2023
white tiled wall with men s restroom sign
State Government

School restroom bill heads to Reynolds’ desk

March 20, 2023
State Government

Iowa House sends government reorganization bill to Reynolds’ desk

March 16, 2023
people running during daytime
Opinion

Ernst: For our daughters.

March 13, 2023
Reynolds appoints Chad Aldis to head Iowa Dept. of Education
Education

Reynolds appoints Chad Aldis to head Iowa Dept. of Education

March 9, 2023
Next Post

Iowa Ranks 9th Nationally for Fiscal Health

Reynolds Appoints Kraig Paulsen to Head the Iowa Department of Management

Reynolds Appoints Kraig Paulsen to Head the Iowa Department of Management

Sign-Up For Our Daily Updates

Get The Iowa Torch right in your inbox!

Please wait...

Thank you for signing up!

Recommended Articles

NRCC Targets Axne in New Ad Linking Her to Biden

NRCC Targets Axne in New Ad Linking Her to Biden

September 28, 2021
Reynolds to Give Condition of the State Address on January 12

Reynolds to Give Condition of the State Address on January 12

January 4, 2021

Hinson: President Biden ‘Skirted Responsibility’ in Afghanistan Remarks

August 28, 2021

Popular Stories

  • Iowa’s New Unemployment Rate Holds Steady, Overall Rates Rise

    Horn: It’s time for employers get serious about Iowa’s untapped workforce

    0 shares
    Share 0 Tweet 0
  • School restroom bill heads to Reynolds’ desk

    0 shares
    Share 0 Tweet 0
  • Ernst: Biden’s WOTUS whiplash.

    0 shares
    Share 0 Tweet 0
  • Reynolds signs two bills addressing transgender children

    0 shares
    Share 0 Tweet 0
  • Regents Board President pauses new DEI programs at Iowa’s public universities

    0 shares
    Share 0 Tweet 0

The Iowa Torch

The Iowa Torch​ is a for-profit, news organization that focuses on political news as it relates to Iowans

Categories

  • Education
  • Federal Government
  • Iowa History
  • Local Government
  • News
  • Opinion
  • Politics
  • State Government
  • Uncategorized
  • Uncategorized

Newsletter

Please wait...

Thank you for signing up!

© 2022 The Iowa Torch, a publication of 4:15 Communications, LLC.

No Result
View All Result
  • Home
  • About Us
  • Advertise
  • Contact Us
  • State Government
  • Federal Government
  • Local Government
  • Politics
  • Education
  • Opinion

© 2022 The Iowa Torch, a publication of 4:15 Communications, LLC.