State and local governments depend on many different types of taxes, one of which is known as an excise tax. Like general sales taxes, excise taxes are paid on the purchase of an item. But unlike sales taxes, excise...
The facts on Iowa’s Tax Climate
8.98%individual income taxTop rate
12%corporate income taxTop rate
$1479property taxcollections per capita
Iowa's Individual Income Tax System
Iowa's personal income tax system consists of nine brackets and a top rate of 8.98%. That rate ranks 5th highest among states levying an individual income tax. Iowa's state and local income tax collections per person were $1019 in 2012 which ranked 20th highest nationally.
50-State Table of Individual Income Tax Rates
50-State Table of State Individual Income Tax Collections
50-State Table of State and Local Individual Income Tax Collections Per Capita
Iowa's Corporate Income Tax System
Iowa's corporate income tax system consists of four brackets and a top rate of 12%. That rate ranks highest among states levying a corporate income tax. Iowa's state and local corporate income tax collections per person were $139 in 2012 which ranked 19th highest nationally.
50-State Table of Corporate Income Tax Rates
50-State Table of State and Local Corporate Income Tax Collections Per Capita
50-State Table of State Corporate Income Tax Collections Per Capita
Iowa Sales and Excise Taxes
Iowa levies a 6% general sales or use tax on consumers, which is above the national median of 5.95%. The average local sales tax rate is an additional 0.78%. Iowa's state and local governments collect $1047 per person in general sales taxes and $437 per person in excise taxes, for a combined figure of $1484, which ranks 22nd highest nationally. Iowa's gasoline tax stands at 22¢ (16th lowest nationally), while its cigarette tax stands at $1.36 (25th highest nationally.)
50-State Table of State and Local General and Selective Sales Tax Collections Per Capita
Iowa Property Tax Collections Relatively High
Iowa's state and local governments collected approximately $1479 per person in property taxes in 2012, which ranks 15th highest nationally.
State and local property tax collections per capita by state
Tax Freedom Day Arrives on April 13th in Iowa
Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2014, Iowa taxpayers worked until April 13th (19th earliest nationally) to pay their total tax bill. The Tax Freedom Days of neighboring states are: Minnesota, April 29th (ranked 5th latest nationally); Wisconsin, April 22nd (ranked 13th latest nationally); Illinois, April 28th (ranked 7th latest nationally); Missouri, April 11th (ranked 15th earliest nationally); Nebraska, April 14th (ranked 23rd earliest nationally); and South Dakota, April 4th (ranked 3rd earliest nationally).
Iowa's State and Local Tax Burden Below National Average
Iowa's 2011 tax burden of 9.3% ranks 22nd lowest out of 50 states, and is below the national average of 9.8%. Iowa's taxpayers pay $3740 per capita in state and local taxes.
Iowa's State-Local Tax Burden, 1977-Present
Other States' State/Local Tax Burdens
Map of U.S. Showing all State's Burdens and Ranks
Historical Chart Comparing All States' State/Local Tax Burdens from 1977 to 2009
Iowa's 2015 Business Tax Climate Index Ranks 41
Iowa ranks 41st in the Tax Foundation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes, individual income taxes, sales taxes, unemployment insurance taxes, and taxes on property, including residential and commercial property. The ranks of neighboring states are as follows: Minnesota, 47th, Wisconsin, 43rd, Illinois, 31st, Missouri, 17th, Nebraska, 29th, and South Dakota, 2nd.
State Business Tax Climate Index (full study)
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