Iowa Policy Points

127 Million New Reasons We Cannot Afford New Tax Breaks

The Iowa Revenue Estimating Conference met Thursday and dropped its revenue estimate for the current fiscal year by $127 million.

The REC estimate projects Iowa to have lower receipts in the current year than in the budget year that ended June 30, by $2.5 million.

A common-sense approach to budgeting would leave one clear message above all others: Drop the talk about tax cuts. We cannot afford any more of them, and we need to double down on a focus on reining in the giveaways that are already on the books, running automatically outside the budget process.

Already:

Corporations are not people; they are tools designed for the purpose of making profit. Some of their activities can serve a greater good, but this is not automatic. They will seek and take new tax breaks if allowed, no matter the longer-term cost to services that support a level playing field for business and greater opportunity and health for all.

Budget choices, on the other hand, reflect a moral purpose — choices that advance values we share as members of our various communities, our state and our nation.

Through that lens of Iowa values, and the added context of tight revenues due largely to reckless and unaccountable giveaways, and the reality that tax breaks don’t pay off in greater revenues under even tortured economic analysis, it is impossible to suggest that new tax breaks make sense.

There are approaches to tax reform that make sense. They start with principles that put fairness, public benefit and adequate revenues ahead of political power brokers.

Our state lawmakers have less than three months to get a grip on fiscal and economic reality and make that fit with traditional Iowa values that foster promise for everyone in our state.

Mike Owen, Executive Director of the Iowa Policy Project

mikeowen@iowapolicyproject.org