Iowa Tax Collections Up 6.7% in Past Five Months

(Radio Iowa) State tax collections are continuing to grow significantly, but tax cuts that take effect soon will likely alter that trend. Net state tax revenue is up six-point-seven percent over the past five months. Jeff Robinson, a fiscal analyst for the Legislative Services Agency, notes the top state income tax rates for individuals and corporations will be reduced January 1st.

“Retirement income will become exempt from income tax,” Robinson says. “In addition, the state’s inheritance tax will be further reduced.” In October, a panel of experts predicted those cuts will lead to a two-point-seven percent reduction in total state tax collections. The Revenue Estimating Conference meets again this Wednesday to review the latest data and settle on a new prediction. The panel’s total tax estimate will be used as a starting point for state budget decisions.