Poll: Protecting Federal Deductibility on Iowa Tax Returns Remains Overwhelmingly Popular

(Alexandria, VA) – “No tax on a tax” – that was the overriding message from a statewide poll of general election voters fielded January 6-7, 2010 and released today. The non-partisan National Taxpayers Union Foundation (NTUF) commissioned the survey, which also provided other insights into Iowans’ opinions on tax burdens and the economy.

Iowa is one of a small number of states that continues to allow taxpayers to deduct federal income tax payments on their Iowa income tax returns. This is commonly known as federal deductibility and ensures Iowans are not paying state income taxes on dollars being used solely to pay federal income taxes.

“When we asked Iowans if they supported keeping federal deductibility, an overwhelming 77.2 percent of respondents indicated this important provision should remain part of the Iowa income tax code,” said Duane Parde, NTUF President.

Protecting federal deductibility had its highest level of support from Independent /Non-affiliated voters, at 81.4 percent; 75.3 percent of Democrats support keeping federal deductibility, while 80.2 percent of Republicans support the issue. In addition, a deeper look at the data indicates keeping federal deductibility has backing across all income levels, including 75 percent of those with family incomes under $30,000, and a whopping 83.5 percent of Iowans with family incomes from $30,000-$50,000.

Among other key findings, 54.5 percent of Iowans believe federal deductibility is good for the middle class, while only 18 percent believe it’s a tax break for the wealthy. In addition, 64.4 percent of respondents indicated that it is wrong to pay a tax on a tax and that federal deductibility is simply a matter of fairness.

“Clearly Iowans across the political and income spectrums want to retain federal deductibility on state tax returns,” Parde concluded. “The Iowa Legislature and Governor would be wise to leave federal deductibility alone, especially considering the political environment.”

The NTUF survey showed 47.3 percent of Iowans believe the State is headed in the wrong direction while only 32.8 percent believe things are on the right track. In addition, 47.1 percent of Iowans indicated they are taxed too much, while a meager 1.2 percent said too little.

Survey respondents included 822 Iowa voters. The poll was conducted by Victory Enterprises, Inc., an Iowa-based public opinion research firm. The survey was balanced by geography, party and age based on likely general election voters; it has a 3.42 percent margin of error.

NTUF is the research and educational arm of the National Taxpayers Union, a citizen group founded in 1969 to work for lower taxes, smaller government, and economic freedom at all levels.