This was the week when our governor’s gaze turned to fertilizer and taxes.
It took a whopping $110 million in state tax breaks and other incentives. Lee County approved $133 million in local tax breaks. The company will save $360 million in interest on bonds by using a special flood recovery program. There’s probably a few million here and there that I’m missing.
Iowa originally offered $25 million in state help. But then Illinois entered the contest.
Branstad has made smacking Illinois a regular part of his Iowa sales pitch.On Tuesday, when he introduced Republican vice presidential nominee Paul Ryan in Cedar Rapids, Branstad, voice rising, passion building, blasted “Obama’s state of Illinois” and the “Chicago politicians” who have run the country “into the ground.”
I half expected him to announce that he had ordered units of the Iowa National Guard to cross the Mississippi and liberate Moline.
So we had to beat those gangsters. And that meant making Orascom an offer it couldn’t refuse.
But the governor says it’s the tax code that made him do it.
Sensing possible taxpayer sticker shock, the governor argued that it’s our lousy business climate that forced him to play Santa Claus.
But we can stop the madness. If only the Legislature would pass his soon-to-be-revealed plans for cutting corporate income taxes and commercial property taxes, we won’t have to fork over the last $50 million in breaks to the Egyptians. And Santa can put away his big giveaway bag.
I agree that a better tax climate for all businesses beats giving the farm to a few. But is Branstad really serious?
We’ll know he’s serious if his plan to cut corporate taxes also eliminates a slug of pricey corporate tax credits carved into our code that make our tax structure look like Swiss cheese. Firms want low taxes, but they also want simple, predictable, stable taxes that don’t require a legion of lawyers to prepare.
With a more competitive tax code, surely the governor can dismantle most of the incentives programs and corporate giveaways we have now. If the governor is serious about local jobs, his property tax reform plan will include new ways for local governments to raise they bucks needed to provide infrastructure and services for businesses new and current.
Otherwise, we’ll know Branstad’s moment of clarity is just spin. We’ll know that he really wants it all, loopholes, giveaways and tax cuts, while giving up nothing. This big deal, rather than bringing economic development sanity, will simply up the ante.
Instead of sobering up after our Orascom binge, all we’ll have done is expand the liquor cabinet. Cheers.