Two solutions to close corporate tax loopholes in Iowa

What’s at stake:

 

Iowa’s small local businesses are the backbone of our economy, but bad public policy puts them at a massive disadvantage when competing with huge out-of-state corporations, which are allowed to funnel millions in un-taxed profits out of Iowa. This tax loophole hurts local business and starves our state of tax revenue. What’s worse, Iowans aren’t even allowed to know how much big corporations actually pay in state income taxes.

 

What we’re pushing for:

 

Corporate Tax Transparency

 

Iowans deserve to know how much (or often, how little) big business is actually contributing to our state tax coffers. We’re pushing legislation requiring that publicly traded corporations disclose the amount of income taxes they pay to the State of Iowa. These numbers should be available to the general public for at least two years after the reporting period.

We can’t even start to build a fair tax system suited to the 21st century until the citizens of Iowa know which corporations are paying how much in state taxes. No longer should big business be allowed to hide in the shadows – we need this law to bring their tax records to light.

 

Combined Corporate Reporting

 

Every year, huge out-of-state corporations avoid paying their fair share of taxes to Iowa by using a tax loophole that the Iowa legislature has yet to close.  We’re pushing that the Iowa legislature close this tax loophole by requiring out-of-state corporations to combine their reporting of profits and pay their fair share of taxes to the state of Iowa on those profits.

Iowa is one of 21 states that has yet to close this loophole.  In the states that have closed the loophole, making out-of-state corporations pay their fair share of taxes, it has not hurt the profits, productivity, or expansion of out-of-state corporations in those states.  Closing this loophole would keep at least $100 million per year in revenues in the state coffers.

Passing combined corporate reporting is a common-sense solution to providing fairness and a level playing field for Iowa businesses and out-of-state corporations.  We call on the legislature and Governor Branstad to pass this legislation during the 2013 legislative session, and to stop balancing the budget on the backs of everyday Iowans.

 

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