SF 104 (LSB 1875XS (2) 86)

SENATE FILE 104

BY  ANDERSON

A BILL FOR

An Act reducing the individual and corporate income tax rates and including effective date and applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 422.5, subsection 1, paragraphs a through i, Code 2015, are amended to read as follows:
   a.  On all taxable income from zero through one thousand dollars, thirty-six twenty-nine hundredths of one percent.
   b.  On all taxable income exceeding one thousand dollars but not exceeding two thousand dollars, seventy-two fifty-eight hundredths of one percent.
   c.  On all taxable income exceeding two thousand dollars but not exceeding four thousand dollars, two and forty-three one and ninety-four hundredths percent.
   d.  On all taxable income exceeding four thousand dollars but not exceeding nine thousand dollars, four and one-half three and six-tenths percent.
   e.  On all taxable income exceeding nine thousand dollars but not exceeding fifteen thousand dollars, six and twelve hundredths four and nine-tenths percent.
   f.  On all taxable income exceeding fifteen thousand dollars but not exceeding twenty thousand dollars, six and forty-eight five and eighteen hundredths percent.
   g.  On all taxable income exceeding twenty thousand dollars but not exceeding thirty thousand dollars, six and eight-tenths five and forty-four hundredths percent.
   h.  On all taxable income exceeding thirty thousand dollars but not exceeding forty-five thousand dollars, seven and ninety-two six and thirty-four hundredths percent.
   i.  On all taxable income exceeding forty-five thousand dollars, eight and ninety-eight seven and eighteen hundredths percent.
    Sec. 2.  Section 422.33, subsection 1, paragraphs a, b, c, and d, Code 2015, are amended to read as follows:
   a.  On the first twenty-five thousand dollars of taxable income, or any part thereof, the rate of six four and eight-tenths percent.
   b.  On taxable income between twenty-five thousand dollars and one hundred thousand dollars or any part thereof, the rate of eight six and four-tenths percent.
   c.  On taxable income between one hundred thousand dollars and two hundred fifty thousand dollars or any part thereof, the rate of ten eight percent.
   d.  On taxable income of two hundred fifty thousand dollars or more, the rate of twelve nine and six-tenths percent.
    Sec. 3.  EFFECTIVE DATE.  This Act takes effect January 1, 2016.
    Sec. 4.  APPLICABILITY.  This Act applies to tax years beginning on or after January 1, 2016.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   This bill reduces by approximately 20 percent the tax rate for each of the nine tax brackets of the individual income tax and for each of the four tax brackets of the corporate income tax.
   The current individual income tax rates range from a low of .36 percent to a high of 8.98 percent. The bill changes these rates to a low of .29 percent and a high of 7.18 percent.
   The current corporate income tax rates range from a low of 6 percent to a high of 12 percent. The bill changes these rates to a low of 4.80 percent and a high of 9.60 percent.
   The bill takes effect January 1, 2016, and applies to tax years beginning on or after that date.