Iowans for Tax Relief packed the galleries of the House chambers with over 500 people opposed to the elimination of federal deductibility. ITR also organized three buses of students that came from Iowa State, UNI, and the University of Iowa.
Many of the people in attendance were wearing red t-shirts with the little figure from their TV ads holding up a sign that says, “no tax on a tax.” ITR was also passing out buttons with the same message as people passed through the capitol cafeteria.
Before the public hearing began, Rep. Christopher Rants addressed his collogues in the House and gave a real-world example of how two different families would be affected by House File 807, the repeal of federal deductibility.
Rep. Rants first talked about a family that earns $48,839 dollars a year. Under current law, this family pays $963 in state taxes. If federal deductibility is repealed, the same family would be required to pay $1173, a $210 increase.
Rep. Rants then gave an example of a family who earns $100,179 a year. Under current law they pay $4244 in state taxes. If federal deductibility is repealed, the same family would be required to pay $3812, a $432 decrease.
Rants’ example shoots holes in the Democrats’ argument that the bill is revenue neutral. It is not. Republicans have noted that the bill increases taxes on Iowans by $600 million from day one, and they are correct. This would be the largest tax increase in Iowa’s history, yet Democrats call the bill “middle class tax relief.”
Democrats went from claiming that this bill was revenue neutral, to then saying that the bill would cut taxes for the majority of Iowans. It’s safe to say that if a family making $48,000 a year is going to see their taxes go up, most Iowa taxpayers are at risk of seeing their own tax bill increase.
Even the Des Moines Register is touting that the bill raises taxes on people who only earn $10,000. That could be a retiree who works part time for extra money or a college student who is trying to pay his or her way through college. Still, Democrats stand behind the bill because they say they are looking at the overall picture of who would benefit.
Eliminating federal deductibility has away been about one thing: finding $600 million to help fill in the budget gap that the Democrats created by their own reckless spending over the past few years. The people of Iowa have seen enough. They are opposed to a taxpayer bailout for Democrat politicians.
Democrats need this $600 million to be able to make their budget work in fiscal year 2010. The Democrats have no option but to pass the largest tax increase in Iowa’s history. They now face serious objections from a majority of the public, and even tradition media outlets, like the Des Moines Register, are shooting holes in their plan.
blog comments powered by Disqus