Recently I had the opportunity to address the Iowa House Ways and Means Committee regarding Iowa taxes. Being one of the higher taxed states in the Midwest, I believe our leaders need to consider lowering taxes and removing the complexity of our current tax system.
My reasons for such considerations revolve around making Iowa attractive to new businesses and residents; preparing for the future challenges of Medicaid, public pension benefits and economic downturns; and allowing greater use of my own resources to invest in the needs and opportunities in my community.
I can only imagine the pressure upon our leaders when such discussions arise. No doubt a plethora of “good things” find space in our Iowa state budget and a tax cut could endanger some of them. As you ponder our current tax rates that have remained unchanged in 20 years, I’m hoping our legislators will consider the following.
Know the limits of government. What is it that government needs to do and is best at doing? One of my great fears is government attempting to become the solution for every problem. I don’t believe it’s realistic for any person, organization, business, or entity to be the only answer. We all need to admit government’s limitations.
Government needs to focus both on containing expenses and raising revenue. First and foremost, recognize you are entrusted with precious dollars from citizens who believe that taxes are necessary to accomplish common good. No room exists for waste, extravagance or ineffectiveness. The budget should always be tight and it should always be difficult to spend taxpayer dollars. Furthermore, an attractive tax rate for individuals and corporations can make Iowa a worthy investment for new businesses and residents. Let’s grow our tax revenue through growing our economic output as a state.
Aim to keep it local and personal. I openly admit my fear of “big.” In “big” is where inefficiencies and ineffectiveness thrive. As a general rule, I want more taxes and government to stay local. I like less coming from the Federal and State governments. I believe the best chance for community change comes from local people, local dollars and local passions and priorities.
Finally, think long-term and not short-term. Now is the time to address the future challenges for our state. Future economic downturns can be expected. Public pension plan obligations and Medicaid expenses will surely rise with an aging population. Are we on a sustainable path? I hope our leaders will make the hard decisions today to protect our future.