This Wine Tax Will Not Age Well

Sour grapes! Iowa has the fourth highest tax on wine in the nation.

When considering wine, Iowa may not necessarily be the first region connoisseurs think about. However, Iowa’s wine industry does have an economic impact in our state. Iowans and tourists often visit one of nearly 100 wineries and the state government taxes wine at $1.75 per gallon, which the Tax Foundation reports as the fourth highest in the nation.

The Iowa Wine Growers Association reports that wine does contribute to the state’s economy. Iowa has more than 275 vineyards, 1,300 acres of grapes, and 8 wine trails. Wine’s economic impact to Iowa includes:

• 2,600 wine related jobs
• 358,000 wine related tourists
• $41 million in wine related spending per year
• $420 million economic impact

Iowa’s high wine tax not only hurts producers, but ultimately it is wine consumers who end up paying the tax. The wine tax is just another example in a long list of Iowa’s high tax rates. Wineries, just as with craft and specialty breweries, are small businesses that are expanding in many states. High taxes should not stifle small business growth.

Perhaps it’s time to crush high tax rates in Iowa and allow economic growth and liberty to flow.