Only two states — Alabama and Louisiana — allow full deductions for federal corporate income tax and only Iowa and Missouri allow a 50 percent deduction for federal corporate income taxes.
Only two states — Alabama and Louisiana — allow full deductions for federal corporate income tax and only Iowa and Missouri allow a 50 percent deduction for federal corporate income taxes.Tags: Free Hotel Business PlanCompany Overview Business PlanHuck Finn Internal Conflict EssayThe Importance Of Getting A College Education EssayChekhov A Collection Of Critical EssaysMla Ted Research Papers
A number of other actions can be taken to improve the fiscal stability and adequacy of Iowa’s tax system.
There certainty needs to be more scrutiny of the manner in which tax credits are awarded, and unproductive and overly generous tax credits should be scaled back.
Eliminate the corporate income federal tax deduction.
Iowa allows businesses filing corporate income tax returns to deduct half their federal income tax payments.
In fact, it is the brick-and-mortar retailers that need help.
In this same vein Iowa should repeal the sales and use tax exemption for digitally delivered goods, which would generate about million a year in additional revenue.
Not requiring combined reporting puts Iowa-based corporations at a competitive disadvantage relative to large national firms.
Making this change has the potential of increasing corporate tax revenues by 0 million or more, which could be used to lower tax rates and to fund critical state needs.6.
Reducing Iowa’s top corporate income tax rate of 12 percent, which is the highest in the country, to 9 percent or less would make Iowa more economically competitive.
This would also help smaller Iowa-based corporations with most of their sales in Iowa and shift some of the tax burden to larger national companies.5.