Iowans would see their income taxes cut further and faster under legislation proposed by Gov. Kim Reynolds.
Reynolds’ wide-ranging tax bill, House Study Bill 543, would also cut the unemployment taxes paid by businesses and reduce taxes on child care centers.
She laid out the tax proposal in her annual Condition of the State address on Jan. 8. Other parts of the governor’s agenda this year include overhauling special education services in Iowa, boosting teacher pay and consolidating Iowa’s boards and commissions.
Here’s a look at what’s in Reynolds’ tax cut legislation.
How Gov. Kim Reynolds wants to further drop Iowa’s income tax
After signing several rounds of tax cuts during her time as governor, Reynolds is again proposing to lower Iowans’ personal income tax rate.
Iowa’s top tax rate is 5.7% as the state phases in a 2022 law that is already scheduled to bring down the individual income tax rate to a 3.9% flat tax by 2026.
Reynolds’ bill would speed up that process and make further cuts by dropping Iowa’s income tax rate to a flat tax of 3.65% for 2024 and make the change retroactive to the beginning of the year.