House Study Bill 232 - Introduced HOUSE JOINT RESOLUTION _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS RESOLUTION BY CHAIRPERSON KAUFMANN) HOUSE JOINT RESOLUTION A Joint Resolution proposing amendments to the Constitution of 1 the State of Iowa relating to requirements for certain state 2 tax law changes and creating a taxpayer relief fund. 3 BE IT RESOLVED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 2537YC (1) 90 jm/jh

H.J.R. _____ Section 1. The following amendment to the Constitution of 1 the State of Iowa is proposed: 2 The Constitution of the State of Iowa is amended by adding 3 the following new section to new Article XIII: 4 ARTICLE XIII. 5 TAXATION LIMITATIONS. 6 Section 1. Two-thirds majority vote for state tax law 7 changes. Passage of a bill that increases the individual 8 income tax rate or the corporate income tax rate, or the rate 9 of any other type of tax based upon income, shall require the 10 affirmative votes of at least two-thirds of the members elected 11 to each house of the general assembly. This requirement does 12 not apply to taxes imposed at the option of a local government. 13 Passage of a bill that establishes a new tax on any type of 14 income imposed by the state shall require the affirmative votes 15 of at least two-thirds of the members elected to each house of 16 the general assembly. 17 A lawsuit challenging the proper enactment of a bill under 18 this section must be filed no later than one year following the 19 enactment. If such a lawsuit is not filed within the one-year 20 limit, the bill shall be considered properly enacted under this 21 section. 22 Each bill to which this section applies must include a 23 separate provision describing the requirements for enactment 24 prescribed by this section. 25 The general assembly shall enact laws to implement this 26 section. 27 Sec. 2. The following amendment to the Constitution of the 28 State of Iowa is proposed: 29 The Constitution of the State of Iowa is amended by adding 30 the following new section to new Article XIII: 31 ARTICLE XIII. 32 TAXATION LIMITATIONS. 33 Sec. 2. Taxpayer relief fund. A taxpayer relief fund is 34 created within the treasury for the purposes of reductions to 35 -1- LSB 2537YC (1) 90 jm/jh 1/ 3

H.J.R. _____ income tax rates, sales and use tax rates, or property taxes, 1 as determined by the general assembly. Moneys in the fund 2 shall be exclusively appropriated or transferred by law for 3 these purposes. The general assembly shall determine the type 4 of, amount of, and manner in which state moneys are credited 5 to, deposited in, or transferred to the fund. The general 6 assembly shall provide by law for the implementation of this 7 section, including by providing for the administration of the 8 fund. 9 Sec. 3. REFERRAL AND PUBLICATION. The foregoing proposed 10 amendments to the Constitution of the State of Iowa are 11 referred to the general assembly to be chosen at the next 12 general election for members of the general assembly, and shall 13 be published as provided by law for three months previous to 14 the date of that election. 15 EXPLANATION 16 The inclusion of this explanation does not constitute agreement with 17 the explanation’s substance by the members of the general assembly. 18 This joint resolution proposes amendments to the 19 Constitution of the State of Iowa by restricting certain state 20 tax law changes and creating a taxpayer relief fund. 21 RESTRICTIONS ON CERTAIN STATE TAX LAW CHANGES. The 22 amendment requires a bill that increases the individual income 23 tax rate or corporate income tax rate, or the rate of any 24 other type of tax based upon income, to be adopted by at least 25 two-thirds of the members elected to each house of the general 26 assembly. In addition, the amendment requires a bill that 27 establishes a new tax on any type of income imposed by the 28 state to be adopted by at least two-thirds of the members 29 elected to each house of the general assembly. A lawsuit 30 challenging enactment of a bill subject to the two-thirds 31 majority passage requirement must be filed no later than 32 one year following the enactment of the bill. Finally, the 33 amendment requires the general assembly to enact laws to 34 implement the amendment. 35 -2- LSB 2537YC (1) 90 jm/jh 2/ 3

H.J.R. _____ TAXPAYER RELIEF FUND. Under current law (Code section 1 8.57E), a taxpayer relief fund is created for purposes of 2 appropriations or transfers made by the general assembly for 3 tax relief or reductions in income tax rates. The amendment 4 sets forth a similar provision in the Constitution of the State 5 of Iowa by creating a taxpayer relief fund for the purposes 6 of reductions to income tax rates, sales and use tax rates, 7 or property taxes. The amendment requires the moneys in 8 the taxpayer relief fund to be exclusively appropriated or 9 transferred by law for the purposes of reductions to income tax 10 rates, sales and use tax rates, or property taxes. 11 REFERRAL. The resolution, if adopted, would be published 12 and then referred to the next general assembly (91st) for 13 adoption, before being submitted to the electorate for 14 ratification. 15 -3- LSB 2537YC (1) 90 jm/jh 3/ 3