Under current Iowa code manufacturers in our state are required to pay sales tax on many of the “consumables” in the manufacturing process. And then the end product is subject to sales tax as well. Ending this double tax on manufactured products was a bill that passed the Iowa House twice in the past two years, but was never called up for a vote by the Senate majority leader. Senate Republicans, much like the House, believe this is good tax policy because it places the tax on the final product and not the inputs. Unfortunately, the Senate majority does not share the same view. Senate Republicans stand firm; Iowa’s manufactured products should not be double-taxed.
Making that fix in the consumables tax language would allow manufacturers to invest in new equipment. More importantly, ending the “double tax” creates an environment in which companies can continue to pay good wages and employ more skilled workers. We must continue to develop tax policy that encourages productivity and jobs.
The legislature continues to work on budget appropriations as well as finishing up other legislation. One key piece of legislation that is still in process is the Home Base Iowa plan which is designed to encourage our veterans to return to Iowa when their military career is over. Senate File 303 was passed in the Senate early in the session and moved over to the House where additional policy language was added consistent with Gov. Branstad’s requests. This improved bill has not yet come forward in the Senate for final passage. As the ranking member of the Senate Veterans Affairs committee, I have requested that the majority leadership brings this bill forward before we wrap up the 85th General Assembly.
Sen. Ken Rozenboom