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Key Votes

SF 2380 - Tax Law Amendments - Key Vote

Iowa Key Votes

Kim Reynolds voted Nay (Passage) on this Legislation.

Read statements Kim Reynolds made in this general time period.

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Legislation - Signed (Executive) -

Title: Tax Law Amendments

Legislation - Concurrence Vote Passed (Senate) (31-19) - (Key vote)

Title: Tax Law Amendments

Vote Smart's Synopsis:

Vote to concur with House amendments and pass a bill that amends the maximum limits and amounts of various tax credits and establishes the Legislative Tax Expenditure Committee to review tax expenditures and tax incentives.

Highlights:
-Prohibits registration of new projects under the film, television, and video project promotion tax credit and income exclusion program until July 1, 2013, effective upon enactment of this bill (Secs. 5-6). -Reduces the maximum aggregate tax credit limit for the following economic development programs so that credits may not be authorized for such purposes in an amount exceeding $120 million, rather than the $185 million limit authorized by existing law (Sec. 4):
    -The high quality job creation program; -The film, television, and video project promotion program; -The corporate tax research credit under the quality jobs enterprise zone program; -The enterprise zones program; and -The assistive device tax credit program.
-Changes the manner in which tax credits are authorized for the supplemental research activities credit as follows (Secs.7-8):
    -Existing law:
      -The credit equals the sum of 6.5 percent of the excess of qualified research expenses during the tax year over the base amount for the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities plus 6.5 percent of the basic research payments determined under 26 U.S.C. 41(e)(1)(A) during the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities;
    -New law:
      -For eligible businesses whose gross revenues do not exceed $20 million per year, the credit equals the sum of 10 percent of the excess of qualified research expenses during the tax year over the base amount for the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities plus 10 percent of the basic research payments determined under 26 U.S.C. 41(e)(1)(A) during the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities; and -For eligible businesses whose gross revenues do exceed $20 million per year, the credit equals the sum of 3 percent of the excess of qualified research expenses during the tax year over the base amount for the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities plus 3 percent of the basic research payments determined under 26 U.S.C. 41(e)(1)(A) during the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities.
-Limits the amount tax credits that may be issued under the Iowa fund of funds program to no more than $60 million, rather than the $100 million limit in existing law (Sec. 20). -Reduces the maximum limit on accelerated career education job credits so that the total amount of credits may not exceed $5.4 million, rather than the $6 million limit in existing law (Sec. 9). -Establishes a Legislative Tax Expenditure Committee to review all tax expenditures and tax incentive programs, and specifies that it shall be characterized by the following attributes (Sec. 2):
    -Be composed of 10 members of the general assembly (5 members from each house) that will be appointed by the legislative council; and -Out of the 5 members from each house, the council shall appoint 3 members from the majority party and 2 members from the minority party.
-Specifies that the Legislative Tax Expenditure Committee shall have duties which include the following (Sec. 3):
    -Evaluating any tax expenditure under Iowa law and assessing its equity, simplicity, competitiveness, public purpose, adequacy, and extent of conformance with the original purposes of the legislation that enacted the tax expenditure; -Establishing and maintaining a system for making available to the public information about the amount and effectiveness of tax expenditures as they relate to the original intent of their associated legislation; -Submitting a report to the legislative council containing the results of the review of tax expenditures, which may include recommendations for better aligning tax expenditures with the original intent of the legislation that enacted the tax expenditure; and -Submitting tax expenditure estimates and recommendations for the each fiscal year to the Governor by December 15, to be used for the budget process.
-Requires the Legislative Tax Expenditure Committee to adhere to the following schedule of review of specific tax expenditures (Sec. 3):
    -In 2011, review the high quality job program,the tax credits for increasing research activities, the franchise tax credits and the earned income tax credit; -In 2012, review the Iowa fund of funds program, property tax revenue divisions for urban renewal areas, targeted jobs withholding credits, funding for urban renewal projects with increased local sales and services tax revenues, school tuition organization tax credits, and tuition and textbook tax credits; -In 2013, review the child and dependent care and early childhood development tax credits, the endow Iowa tax credits, the redevelopment tax credits, the disaster recovery housing tax credits and the tax credits available for film, television and video project promotion; -In 2014, review tax credits for investments in qualifying businesses and community-based seed capital funds, historic preservation and cultural and entertainment district tax credits, wind energy production tax credits, renewable energy tax credits, ethanol promotion tax credits, E-85 gasoline promotion tax credits, and the bio-diesel blended fuel tax credits; and -In 2015, review the agricultural assets transfer tax credit, the assistance device corporate tax credit, the charitable conservation contribution tax credit, the motor vehicle fuel tax credit, the new jobs tax credits and the financial assistance available under the enterprise zones program.
-Requires that each of the previously enumerated tax expenditures and incentives be reviewed again no more than 5 years after the reviews scheduled in the previous highlight (Sec. 3).
Legislation - Bill Passed With Amendment (House) (54-43) - (Key vote)

Title: Tax Law Amendments

Vote Smart's Synopsis:

Vote to pass a bill that amends the maximum limits and amounts of various tax credits and establishes the Legislative Tax Expenditure Committee to review tax expenditures and tax incentives.

Highlights:
-Prohibits registration of new projects under the film, television, and video project promotion tax credit and income exclusion program until July 1, 2013, effective upon enactment of this bill (Secs. 5-6). -Reduces the maximum aggregate tax credit limit for the following economic development programs so that credits may not be authorized for such purposes in an amount exceeding $120 million, rather than the $185 million limit authorized by existing law (Sec. 4):
    -The high quality job creation program; -The film, television, and video project promotion program; -The corporate tax research credit under the quality jobs enterprise zone program; -The enterprise zones program; and -The assistive device tax credit program.
-Changes the manner in which tax credits are authorized for the supplemental research activities credit as follows (Secs.7-8):
    -Existing law:
      -The credit equals the sum of 6.5 percent of the excess of qualified research expenses during the tax year over the base amount for the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities plus 6.5 percent of the basic research payments determined under 26 U.S.C. 41(e)(1)(A) during the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities;
    -New law:
      -For eligible businesses whose gross revenues do not exceed $20 million per year, the credit equals the sum of 10 percent of the excess of qualified research expenses during the tax year over the base amount for the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities plus 10 percent of the basic research payments determined under 26 U.S.C. 41(e)(1)(A) during the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities; and -For eligible businesses whose gross revenues do exceed $20 million per year, the credit equals the sum of 3 percent of the excess of qualified research expenses during the tax year over the base amount for the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities plus 3 percent of the basic research payments determined under 26 U.S.C. 41(e)(1)(A) during the tax year based on the state's apportioned share of the qualifying expenditures for increasing research activities.
-Limits the amount tax credits that may be issued under the Iowa fund of funds program to no more than $60 million, rather than the $100 million limit in existing law (Sec. 20). -Reduces the maximum limit on accelerated career education job credits so that the total amount of credits may not exceed $5.4 million, rather than the $6 million limit in existing law (Sec. 9). -Establishes a Legislative Tax Expenditure Committee to review all tax expenditures and tax incentive programs, and specifies that it shall be characterized by the following attributes (Sec. 2):
    -Be composed of 10 members of the general assembly (5 members from each house) that will be appointed by the legislative council; and -Out of the 5 members from each house, the council shall appoint 3 members from the majority party and 2 members from the minority party.
-Specifies that the Legislative Tax Expenditure Committee shall have duties which include the following (Sec. 3):
    -Evaluating any tax expenditure under Iowa law and assessing its equity, simplicity, competitiveness, public purpose, adequacy, and extent of conformance with the original purposes of the legislation that enacted the tax expenditure; -Establishing and maintaining a system for making available to the public information about the amount and effectiveness of tax expenditures as they relate to the original intent of their associated legislation; -Submitting a report to the legislative council containing the results of the review of tax expenditures, which may include recommendations for better aligning tax expenditures with the original intent of the legislation that enacted the tax expenditure; and -Submitting tax expenditure estimates and recommendations for the each fiscal year to the Governor by December 15, to be used for the budget process.
-Requires the Legislative Tax Expenditure Committee to adhere to the following schedule of review of specific tax expenditures (Sec. 3):
    -In 2011, review the high quality job program,the tax credits for increasing research activities, the franchise tax credits and the earned income tax credit; -In 2012, review the Iowa fund of funds program, property tax revenue divisions for urban renewal areas, targeted jobs withholding credits, funding for urban renewal projects with increased local sales and services tax revenues, school tuition organization tax credits, and tuition and textbook tax credits; -In 2013, review the child and dependent care and early childhood development tax credits, the endow Iowa tax credits, the redevelopment tax credits, the disaster recovery housing tax credits and the tax credits available for film, television and video project promotion; -In 2014, review tax credits for investments in qualifying businesses and community-based seed capital funds, historic preservation and cultural and entertainment district tax credits, wind energy production tax credits, renewable energy tax credits, ethanol promotion tax credits, E-85 gasoline promotion tax credits, and the bio-diesel blended fuel tax credits; and -In 2015, review the agricultural assets transfer tax credit, the assistance device corporate tax credit, the charitable conservation contribution tax credit, the motor vehicle fuel tax credit, the new jobs tax credits and the financial assistance available under the enterprise zones program.
-Requires that each of the previously enumerated tax expenditures and incentives be reviewed again no more than 5 years after the reviews scheduled in the previous highlight (Sec. 3).
Legislation - Bill Passed (Senate) (32-18) - (Key vote)

Title: Tax Law Amendments

Vote Smart's Synopsis:

Vote to pass a bill that relates to tax credits, the administration and review of specified economic development programs and tax incentive programs and the reenactment of the estate tax.

Highlights:
-Establishes that the intentions of this Act are to provide for regular review of all tax credit, withholding credit, and revenue division programs in order to facilitate the reauthorization of "successful" programs at a cost that can be accommodated by the state's annual budget (Sec. 1). -Creates the Legislative Tax Expenditure Committee, which shall have the following attributes (Sec. 2):
    -Be composed of 10 members of the General Assembly (5 members from each house) that will be appointed by the Legislative Council; -Out of the 5 members from each house, the Council shall appoint 3 members from the majority party and 2 members from the minority party.
-Requires the Legislative Tax Expenditure Committee to engage in a regular review of the state's tax expenditures and submit a report of the results of the review to the Legislative Council and provide any recommendations and estimates for the next fiscal year to the Governor by December 15, to be used in preparation for the creation of the next budget (Sec. 3). -Requires the Committee to follow a schedule of review of certain tax expenditures (Sec. 3):
    -2011: review the high quality jobs program and the tax credits for increasing research activities; -2012: review the Iowa Fund of Funds program, property tax revenue divisions for urban renewal areas, targeted jobs withholding credits, funding for urban renewal projects with increased local sales and services tax revenues, school tuition organization tax credits, and tuition and textbook tax credits; -2013: review the child and dependent care and early childhood development tax credits and the Endow Iowa tax credits; -2014: review tax credits for investments in qualifying businesses and community-based seed capital funds, historic preservation and cultural and entertainment district tax credits, wind energy production tax credits, and renewable energy tax credits; -2015: review the agricultural assets transfer tax credit, the claim of right tax credit, the reduction in allocating income to Iowa by S corporation shareholders, the minimum tax credit, the assistive device corporate tax credit, the charitable conservation contribution tax credit, the motor vehicle fuel tax credit.
-Requires that the maximum aggregate tax credit limit for any one fiscal year to not exceed $120 million and that any excess shall be counted against the total amount of tax credits that may be authorized for the next fiscal year (Sec. 4). -Establishes that effective upon enactment, a film program suspension be in place and that the department shall not register a new project until July 1, 2012 (Secs. 5 & 6). -Establishes the following provisions for supplemental research activities credit applicable on or after July 1, 2010. (Secs. 7 & 8):
    -For eligible businesses whose gross revenues do not exceed $20 million per year, the credit equals the sum of 10 percent of the excess of qualified research expenses during the tax year and 10 percent of the basic research payments determined by the Internal Revenue Code during the tax year (based upon the state's apportioned share of the qualifying expenditures for increasing research activities); and -For eligible businesses whose gross revenues exceed $20 million per year, the credit equals the sum of 3 percent of the excess of qualified research expenses during the tax year, and 3 percent of the basic research payments determined by the Internal Revenue Code during the tax year (based upon the state's apportioned share of the qualifying expenditures for increasing research activities).
-Requires that the maximum amount of accelerated career education job credits to not exceed $5,400,000 in any one fiscal year (Sec. 9). -Requires that the maximum amount of agricultural asset transfer tax credits to not exceed $3 million in any one fiscal year (Sec. 10). -Requires that the maximum amount of Endow Iowa tax credits to not exceed a total of $2,700,000 and that the maximum amount of tax credits granted to a taxpayer shall not exceed 5 percent of the aggregate amount of tax credits authorized and shall be applied retroactively to January 1, 2010 for Endow Iowa tax credits authorized on or after January 1, 2010 (Secs. 18 & 20). -Requires that the maximum amount of school tuition organization tax credits to not exceed $6,750,000 beginning on or after January 1, 2011 (Sec. 21). -Requires that the maximum amount of certificates and related tax credits designated to investors to not exceed $60 million and takes effect upon enactment (Secs. 22 & 23). -Establishes that tax credit certificates issued for future tax years for investments made on or before July 1, 2010 are valid and may be claimed by a taxpayer (Sec. 28). -Requires that the maximum amount of historic tax credits for a fiscal year beginning on or after July 1, 2012 to not exceed $45 million and the amount approved prior to July 1, 2012 shall not exceed $50 million (Sec. 31 & 32). -Establishes an estate tax to entail the amount equal to the federal estate tax credit as allowed in the Internal Revenue Code to be imposed upon every transfer of the net estate of every decedent being a resident of, or owning property in, Iowa (Sec. 34). -Establishes that all bonds issued for general public and governmental purpose shall be exempt from taxation by the state of Iowa and the interest on the bonds shall be exempt from the state's estate tax (Secs. 46-52).
Legislation - Introduced (Senate) -

Title: Tax Law Amendments

Committee Sponsors

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