In Fiscal Year (FY) 2013, Iowa collected $14.3 billion in state and local taxes. While this is an impressive sum of money, it tells us little about whether or not the average Iowa taxpayer can afford this level of taxation.
As shown in Chart 1, Iowa’s state and local tax burden (tax collections divided by personal income) was the sixteenth highest in the nation for FY 2013 at 10.4 percent—this is 1 percent above the national average of 10.3 percent. As shown in Chart 2, Iowa’s tax burden has grown by 39 percent to 10.4 percent in FY 2013 from 7.5 percent in FY 1950.
Not surprisingly, being so close to the national average, Iowa’s tax burden by type of tax (property, income, sales, and all other) all hover around the national average.
Of course, the tax burdens for local government can vary just as much as they do among the 50 states. As such, we have also calculated the local government tax burden for every county in Iowa—this includes every taxing jurisdiction within the geographic county borders whether it is a city, a special district, or county government itself.
The Iowa counties with the highest local government tax burden include: Guthrie County, IA (6.4 percent), Ringgold County, IA (6.3 percent), and Dickinson County, IA (6.1 percent). The Iowa counties with the lowest local government tax burden include: Ida County, IA (2.9 percent), Chickasaw County, IA (2.9 percent), and Cherokee County, IA (2.9 percent).
J. Scott Moody has over 18 years as a public policy economist with a specialty in tax policy and has over 180 publications. He has worked for numerous national and state-based think tanks such as Federalism In Action, Tax Foundation, Heritage Foundation, and The Maine Heritage Policy Center.