Bills › 89th General Assembly
Where it is now
- Done: IntroducedJanuary 27, 2022
- Done: SubcommitteeJanuary 27, 2022
- Done: House committeeMarch 15, 2022
- Skipped: Passes the HouseContinued as HF 2563
- Next: Senate committee
- Next: Passes the Senate
- Next: To the Governor
- Next: Signed into law
Became HF 2563 → Its progress continues under the new number. Go to HF 2563 What’s a funnel?
What’s in it
AI summary During the annual clothing sales tax holiday in August, people could also buy emergency preparedness supplies without paying sales tax. Most items must cost less than $100, but generators can qualify if they cost up to $5,000. Each household is allowed to buy only one generator during this tax-free period.1
Read the official explanation
This bill modifies the sales tax holiday. The bill adds the purchase of emergency preparedness supplies to the existing sales tax holiday for clothing during the period beginning at 12:01 a.m. on the first Friday of August and ending at midnight the following Saturday. As with an article of clothing, an emergency preparedness supply item must be under $100 to qualify for the sales tax holiday, except for generators and other specified items which qualify if the sales price does not exceed $5,000. The bill limits the purchase of a portable or permanent generator to one such item per household per sales tax holiday period. The bill defines “emergency preparedness supplies” to mean a collection of basic household items needed in the event of an emergency and includes a list of the items.
House subcommittee
Named January 27, 2022. On March 9, 2022 it recommended amendment and passage. Vote Total: 2-0.
Three legislators hear a bill first and recommend what the committee should do; it’s the best time to weigh in. How to take part
Fiscal note
AI summary This bill expands the Iowa sales tax holiday to include emergency preparedness supplies and adds Sunday as an extra day for the holiday. It increases the price limit for certain items like generators and inverters from $100 to $5,000. The bill is estimated to reduce revenues for the state's General Fund, the Secure an Advanced Vision for Education (SAVE) Fund, and local option sales tax (LOST) by amounts ranging from $3.6 million to $4.1 million in total across fiscal year 2023 through fiscal year 2028.3
Read the fiscal note
Description
House File 2563 expands the Iowa sales tax holiday to include emergency preparedness supplies. The Bill provides an exception to the sales price limit of less than $100 per item for tie-down kits, portable generators, transfer switches, and inverters, for which the maximum allowed sales price is increased to $5,000. The Bill also expands the existing sales tax holiday by one additional day to include Sunday.
Background
The State currently has an annual sales tax holiday held on the first Friday and Saturday of August. During this period, clothing and footwear that meet certain criteria are exempt from sales tax and local option sales tax (LOST). The exemption does not apply to any item selling for $100 or more. The Department of Revenue estimates the amount of sales tax exempted in FY 2023 during the current sales tax holiday will be $4.7 million.
Alabama and Texas currently have a sales tax holiday for certain emergency preparedness supplies.
Assumptions
- Current FY 2022 annual sales of emergency preparedness supplies in the State are estimated to be $18.3 million.
- An estimated 5.0% of emergency preparedness supplies will be purchased during the sales tax holiday. Additionally, 5.0% of purchasers will use the sales tax holiday period to purchase higher-priced items than they would purchase without the holiday.
- Growth trends in future fiscal years are based on Consumer Price Index Urban (CPI-U) average estimated increases of 2.0% from FY 2023 to FY 2028.
- As a result of the number of days in the current sales tax holiday increasing from two to three, the estimated fiscal impact will increase proportionally by 50.0% to account for the additional day of exempted sales.
Fiscal Impact
House File 2563 would reduce revenues to the General Fund, Secure an Advanced Vision for Education (SAVE) Fund, and LOST by the estimated amounts listed below.
Sources
- Department of Revenue
- Iowa Emergency Management Association
- LSA analysis and calculations
- Sales Tax Exemption, Emergency Goods · March 22, 2022
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89th General Assembly
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Earlier and later bills are matched by wording or an identical title.
Similar bills
- HF 46 Modifying the sales tax holiday by extending the holiday and including emergency preparedn…90th General Assembly · Renumbered as HF 702Nearly identical
- SSB 1240 SSB 124089th General Assembly · Approved by committeeSimilar
Matched by wording or an identical title.