Chances of a fuel tax increase in Iowa depend on whether the Iowa legislature can reach an agreement on commercial property tax reform.
So says Carol Balvanz, policy director for the Iowa Soybean Association (ISA).
“I think if the property tax issue—the commercial property tax issue—gets solved through some type of legislation, and there is a reduction, there may be the ability for legislators to see the way to increase Iowa’s fuel tax at a modest level,” Balvanz says, “and still keep the net tax rate at an even keel rather than increasing the taxes.”
ISA and other ag groups are pushing for the fuel tax increase as a way to fund what they say are badly needed repairs to Iowa’s roads and bridges.
“No one wants to see a tax increase and yet our farmers tell us over and over again, ‘we’ve got deteriorating roads and bridges in the rural areas’,” says Balvanz. “We need a tax and this tax is actually dedicated to those roads and bridges—so we need that funding so we can actually make up some of the roads and bridge repair that has been neglected for the last few years.”
Earlier this week the Iowa Senate approved a commercial property tax credit plan targeted at small and Main Street businesses. Some observers think that could move the issue closer to a negotiated compromise with GOP forces led by Governor Terry Branstad.