The Battleship Iowa - obsolete like the Iowa tax law, but no longer as dangerous.
I’ve met some legislators, and in person they can be normal, well-intentioned people. So why do they do silly things like vote for disastrous special subsidies for one industry, like the film tax credit program, or even a single business, like the “Field of Dreams” sales tax giveaway sent yesterday to the Governor? Some comments from legislators in the Des Moines Register coverage of the bill give a clue about the clueless.
It helps to have a legislator who wants to bring pork to his district:
“It’s all about partnerships and it’s all about collaborations,” said Sen. Tom Hancock, D-Epworth, the bill sponsor, whose district includes Dyersville. “I’m happy that the state’s a willing partner to enhance projects like these.”
“Willing?” How does that work? I’m a taxpayer of the state, and there’s nothing “willing” about me paying taxes. If I don’t, I go to jail.
Some legislators just don’t understand that giving special privileges to one taxpayer is by definition unfair to those who have to comply with all of the tax laws:
The state also does not pay for the incentive with existing revenue, since the taxes rebated are those generated by the development and wouldn’t exist if the project didn’t go forward.
“The key difference is we’re not putting taxpayers’ money at risk,” Rep. Stewart Iverson, R-Clarion, said during floor debate. “That’s the key thing that I think helps this project get along the way.”
My existing business will pay a lot of taxes that wouldn’t exist if we stopped going forward. Where’s my check?
A few legislators are catching on:
That feels too much like “picking winners and losers,” said Sen. Jack Whitver, R-Ankeny, and suggests to other development projects or business ventures that lobbying lawmakers is the key to securing lucrative tax breaks.
“I just don’t like the fact these groups have to hire a lobbyist, come down here and basically win us over on their project,” he said.
“Suggests?” More like “broadcasts.”
Will the Governor stop it? He’s the last hurdle to this giveaway. His support for special breaks for ESOPs and “Anchor Manufacturers“ doesn’t telegraph principled opposition to special tax favors.
Joe Kristan writes the Tax Update items, and any opinions expressed or implied are not necessarily shared by anyone else at Roth & Company, P.C. Address questions or comments on Tax Updates to
[...] for itself. The Newton race track has a similar deal. A legislator who voted against the bill pointed out the obvious: That feels too much like “picking winners and losers,” said Sen. Jack Whitver, R-Ankeny, and [...]