Iowa legislators look to lower income tax ahead of 2022 session

Iowa Republicans are looking at eliminating state income taxes in the 2022 session. As the minority party, Iowa Democrats hope to prioritize workforce issues, housing, and childcare among other things during the upcoming 2022 legislative session.



The Iowa State Capitol Building is seen on Tuesday, Jan. 12, 2021 in Des Moines. Tuesday marks the second day of the 2021 Iowa legislative session, including the annual State of the State address given by Gov. Kim Reynolds.

Lauren White, Politics Reporter

The 2022 legislative session is less than a month away, and a key goal of Iowa Republicans to reduce state income tax. Democrats in the minority party say their priorities include improving the state’s workforce crisis and addressing affordable housing and child care to keep people in the state.

At the Greater Des Moines Partnership State Legislative Leadership Breakfast on Dec. 9, Sen. Brad Zaun, R-Urbandale, said Senate Republicans’ main priority for the 2022 session is to lower the state income tax, with the ultimate goal of eliminating it entirely. He said that would be one of the biggest tools to attract people to Iowa.

“That is not going to happen overnight, I know that right now we’re having conversations … in regards to tax credits. I think we need to look at all the tax credits that we have in the state of Iowa to see how effective they are,” Zaun said.

Other legislative leaders — Senate Minority Leader Sen. Zach Wahls, D-Coralville, House Minority Leader, Rep. Jennifer Konfrst, D-Windsor Heights, and Rep. Brent Siegrist, R-Council Bluffs also attended the breakfast to discuss priorities for both parties.

Siegrist said that corporate tax rates will also be looked at during this upcoming session, but the bigger priority is the statewide income tax. He said that the state should be looking at having over $9 billion worth of revenue going into the session with which to budget.

“I think more money into our parks and recs and into our water systems is absolutely the right thing to do. I am not sure how much push that is going to get this year,” Siegrist said. “It’s an election year, there’s sales tax, there’s a lot of support for it but I’m not sure it’ll be enough.”

In a Monday press release, Iowa Gov. Kim Reynolds said the December Revenue Estimating Conference forecast shows an overcollection of Iowa taxpayer funds and vowed to give that money back in the 2022 session.

“I will continue to fight to return these funds to the hands of hardworking Iowa taxpayers and explore significant tax cuts this legislative session that will make Iowa one of the most competitive states in the country,” Reynolds said. “This overcollection of taxes is unethical and it must end.”

Speaker of the Iowa House Rep. Pat Grassley, R-New Hartford, echoed Reynolds’ statements, saying he wants to return the revenue to Iowans, while he criticized the Biden Administration for rising levels of inflation.

RELATED: Johnson County legislators offer education policy critiques in forum hosted by The Daily Iowan

“Iowa House Republicans look forward to addressing this issue and finding the most effective way to lower taxes and return this money to Iowa taxpayers,” Grassley said in a prepared statement issued Monday.

During the legislative panel, Konfrst said that the House and Senate need to address taxes without raising them on those who pay sales tax and to make sure that any policies they enact don’t disproportionately affect less wealthy Iowans.

“I hope what we are looking at is addressing middle-class taxes, finding a way for workers to actually get the benefits of these tax cuts for a change, and I think it’s pretty important to realize that when you’re talking about cutting a lot of taxes and then raising a sales tax, the impact of that is disproportionately on the working poor,” Konfrst said.

Wahls told The Daily Iowan his top priority is to get Iowans good jobs and help them to want to stay in those jobs. He said the Legislature can do this by focusing on investments in career technical education and higher education.

Wahls said that Republicans have enacted or discussed divisive policies that make it difficult for workers in Iowa to want to stay in the state.

“We’ve seen the political environment that Republicans have created makes it very hard to attract workers to Iowa. So, we have a lot of real concerns about where we are and where we see things going,” Wahls said.

Iowa’s population grew 4 percent from 2010 to 2020, but that growth was concentrated in the state’s four largest counties, while population fell in 68 Iowa counties.

Wahls said that Iowans want to see improvements in their education, housing, and child care to stay in Iowa and raise their families in the state and said these issues are what he will be fighting for in 2022.

As the minority party, Wahls said one role the Democrats have is to respond to what Republicans put forward, but he is worried that the GOP will focus on cultural issues as a distraction in the upcoming session.

Konfrst told the DI the upcoming session should focus on putting money back into the pockets of Iowans.

Konfrst said the Legislature will be addressing taxes during this session to create a fair tax system that invests in schools, health care, public safety and infrastructure. She said that middle-class Iowans should be the target for tax cuts.

“Iowans expect us to listen, put aside the politics of division, and to work together to make their lives better and Iowa House Democrats are ready to do that,” Konfrst said.

Konfrst said she, and other legislators, have spent the time since the last session meeting with constituents to see what issues they are facing and what they think should be discussed in the Statehouse. She said she has heard that access to child care and funding for education come up as a concern often.

Representing constituents is one aspect of the Democrats’ jobs, Konfrst said, while the other is holding the majority party accountable when it introduces legislation Democrats oppose.

“You know, when they say they’re doing one thing and they come here and they do something more extreme, it’s our job to let people know that,” Konfrst said.

In an interview with the DI on Thursday, University of Iowa President Barbara Wilson said that she meets with legislators to advocate for the university and hopes this upcoming session will prioritize funding for the state’s public universities.

Wilson said that the University of Iowa does a lot for the state in terms of health care and training professionals and hopes legislators can see the impact the university has on the entire state.

“We’re doing newborn screening for every baby born in the state for free to ensure that we know about genetic challenges and illnesses. We’re helping the K-12 school system train teachers for mental health and wellness,” Wilson said. “I mean, there’s so many things that we can point to that are affecting every county around the state, and so help us make sure this university continues to thrive.”