FY 1999 to FY 2018
The amount of money collected from Iowans for the General Fund has increased from $4.4 billion to $7.38 billion in 20 years.
During the last legislative session, the legislature began the process of lowering Iowa’s high tax rates, but we will still need further rate reduction. Lowering tax rates and unshackling Iowa’s economy from excessive regulations will allow the state to become more competitive.
Iowa’s General Fund collected $7.38 million in FY 2018. Almost 96% was from taxes.
Tax rates do matter. A recent study on taxation and innovation found that individual and corporate income taxes have an impact on innovation. Tax rates can impact the “amount of innovation, the quality of innovation, and location of inventive activity” within a state. A state with low tax rates and low level of regulations allows for greater economic freedom, entrepreneurship, and opportunities.
FY 1999 to FY 2018
Total property tax revenue collected by local governments has increased for over 20 consecutive years. It has doubled in that same time.
It is important all Iowans take an active interest in local government and their school boards. They need to understand what their taxes are used for, but also to hold government entities accountable.
In Iowa, the value of a residential, commercial, industrial, or agricultural property is estimated by the County Assessor every two years. Property tax rates are determined in a multi-step process that includes budget submissions by each taxing authority such as K-12 schools, cities, counties, and hospitals. Once the budgets are submitted, the County Auditor sets tax rates by dividing the total amount of the budget by the taxable value of all the property in the taxing district. That rate is expressed as dollars per thousand of valuation.
FY 1999 to FY 2018
General Fund appropriations have grown from $4.5 billion to $7.3 billion in 20 years.
Government spending is a concern to many Iowans. Individuals, families, and businesses across Iowa all follow a budget that is not guaranteed to increase every year, yet Iowa’s budget continues to grow. Every year the demands on government continue to grow. How can the state meet priorities, raise enough revenue, while at the same time spend tax dollars wisely. The answer to this question rests in following a policy blueprint that lowers tax rates, keeps spending levels low, and establishes the priorities of government.
Public education and health care in Iowa consume the largest share of Iowa’s total government spending.
As greater demands from education and health and human services increase in Iowa, it will place greater pressure on the budget.
These are and should be priorities of lawmakers, but this does not mean that structural reforms cannot be made to improve educational and human service outcomes in Iowa.
K-12 public education consumes a majority of the general fund education spending. Iowa also funds the Regent Universities and the community college system.
When taken into consideration spending on public education is the largest budget driver at the state and local level.
Funding for health and human services in Iowa is the fastest growing and second largest driver of state spending.
Iowa’s Medicaid program consumes the most taxpayer’s dollars and as this program expands the costs will continue to rise. Rising health care costs and increasing demand for health and human services related programs should be a budgetary concern in Iowa.
See a list of all of Iowa's 32 taxes and 1,451 fees along with information about General Fund revenue and spending limitations by downloading the PDF.