REC Projecting Strong Growth for FY22

The Revenue Estimating Conference, a three-person panel that provides budget forecasts for Iowa, met last Friday and concluded that Iowa is set to see 3.8 percent growth for Fiscal Year 2022, which begins on July 1. 

• The projection puts the state at $8,385.6 billion for FY22.
• This is an increase of $307.6 million from the current estimate for FY21. 

These projections are important because:

• It gives us an idea of whether or not Iowa will hit the requirements needed for tax cuts from the state’s 2018 tax law on time.
• The state must hit these marks in order to facilitate the next round of tax cuts in 2023.  
• What we know so far: the revenue tax trigger is projected to hit on time, while the 4-percent growth trigger is not.  
• The tax triggers are based on actual receipts, which means we ultimately won’t know whether the state hits those triggers until September 2022. 

This is the primary reason why ABI has been supportive of eliminating the triggers. Eliminating the triggers will provide predictability and certainty for businesses.

You can read more from The Des Moines Register.