Gov. Kim Reynolds had introduced a new tax reform proposal that she says will benefit every taxpayer in Iowa.
Reynolds discussed the details of her new tax plan in Des Moines at a book binding company called LBS. She says the proposed tax plan will eliminate taxes on retirement income.
Under this new plan, Iowans age 55 and older will be exempt from the state tax on retirement income earned from individual retirement account distributions, taxable pensions and annuities starting in the 2023 tax year.
Gov. Reynolds’ tax plan would also reduce individual income tax to what she called a “flat and fair” 4% by 2026. She says all Iowans who pay income tax will see significant cash savings, and just the first year alone could save taxpayers almost $500 million.