GOP seeks business tax cuts to spur Iowa economy
By MIKE GLOVER, THE ASSOCIATED PRESSDES MOINES - Republican legislators called Wednesday for cutting business taxes to spur Iowa's economy.
The GOP lawmakers said the state should give businesses a tax credit of 50 percent of the salary for each new job they create. Republicans also supported the appointment of an ombudsman to advocate for business and ''root our onerous hurdles, regulations and roadblocks that are standing in the way of job creation.''
''We believe we have to get back to a market-based, capitalistic system,'' said Senate Minority Leader Paul McKinley, R-Chariton. ''All of these programs are geared toward small businesses.''
McKinley didn't have an estimate on what the new tax credit would cost or a projection of how many jobs it would create.
Republicans have largely rejected a $700 million plan offered by Gov. Chet Culver that would borrow money to pay for cleaning up from last summer's record flooding and repairing Iowa's roads, bridges and other infrastructure.
''The governor continues to ask Iowans to put another $700 million on the state' credit card through bonding to pay for infrastructure projects but that project will only create work - not jobs,'' said McKinley.
The new ombudsman would be paid with existing state economic development funds, McKinley said.
''There will be no new money spent on this,'' said McKinley. ''This would not be growing government.''
McKinley released his package at a Statehouse news conference, where he argued that a decade of state economic development policy has been wrong-headed. Rather than spending state money to lure new businesses to the state, the policy should be to cut taxes on existing businesses, he said.
''During the past decade, Iowa has drifted away from supporting existing and potential employers that dot the landscape of Iowa and has instead focused on chasing a few elite and already established mega corporations,'' he said.
McKinley conceded the difficulty of the task he faces with Democrats holding majorities in the House and Senate as well as controlling the governor's office.
''We hope the power of this presentation will prevail,'' said McKinley.
McKinley argued that the GOP plan starts with a big tax cut for businesses that would cover an expansion of 5 percent of the workforce of a business, or 50 jobs, whichever is larger.
''That's an immediate jolt,'' McKinley said.
A business would have to pay at least the county's average wage to be eligible, and the credit wouldn't apply to businesses rehiring workers who have been laid off, McKinley said.
For the longer term, McKinley said he would create a new task force that would solicit ideas and help new businesses get off the ground. He contrasted the GOP proposal with Democratic development efforts he said simply grow government.
''On the their side, Democrats only want to erect more barriers to job creation and spend more money on government programs that create work, but not jobs,'' said McKinley.
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sande88705
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03-05-09 8:31 PM
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And raise the our taxes.Won't be able to afford to buy anything as our taxes will be so high,so what good will it do?
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