Repealing the excise tax on the handling of grain

Sponsored by the House Ways and Means Committee

Topics:Agriculture Taxes

Same legislation: HSB 734

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Official bill page Lobbyist declarations One-pager to print

Where it is now

Done: IntroducedMarch 6, 2024
Done: SubcommitteeMarch 6, 2024
Done: House committeeMarch 13, 2024
Stopped: Passes the HouseDied when the General Assembly ended
Next: Senate committee
Next: Passes the Senate
Next: To the Governor
Next: Signed into law

Died when the session ended The 2024 session adjourned on April 19, 2024, the General Assembly’s last regular session. Bills that didn’t pass both chambers died. What’s a funnel?

What’s in it

AI summary Iowa would get rid of the tax currently charged on every bushel of grain handled at places like elevators, warehouses, and mills. This tax applies to many different types of crops, including corn, wheat, and soybeans. The money collected from this tax is normally used to fund local government services.¹

Read the official explanation

This bill repeals the grain handling excise tax of one-fourth mill per bushel upon all grain handled. For purposes of the tax, “handling or handled” means the receiving of grain at or in each elevator, warehouse, mill, processing plant, or other facility in this state in which it is received for storage, accumulation, sale, processing, or any other purpose. In addition, “grain” means wheat, corn, barley, oats, rye, flaxseed, field peas, soybeans, grain sorghums, spelts, and such other products as are usually stored in grain elevators other than seeds after being processed. The excise tax is entered on the tax list of the taxing district and revenue collected from the excise tax is distributed to the various taxing authorities (taxing units) within the taxing district in the same manner as general property taxes.7.7 provides that for a property tax credit or exemption enacted on or after January 1, 1997, if a state appropriation made to fund the credit or exemption is not sufficient to fully fund the credit or exemption, the political subdivision shall be required to extend to the taxpayer only that portion of the credit or exemption estimated by the department of revenue to be funded by the state appropriation.

Full bill text²

House subcommittee

Named March 6, 2024 (as HSB 734). On March 11, 2024 it recommended passage. Vote Total: 3-0.

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 repeals the tax on grain handling. It is estimated to reduce annual local government revenue by $1.2 million beginning with fiscal year 2027.³

Read the fiscal note

Description

House File 2657 repeals the grain handling excise tax of one-fourth mill per bushel ($0.25 per 1,000 bushels) upon all grain handled. Iowa Code section 25B.7 (State Funding of Property Tax Credits and Exemptions) is made inapplicable to this tax change.

Background

The grain handling tax was enacted in 1947 Iowa Acts, chapter 236 (Excise Tax on Grain Handling Act). The tax is paid to the local property tax system and distributed to local governments, such as cities, counties, and schools, in the same proportions as the tax on real property is distributed.

Grain is defined as wheat, corn, barley, oats, rye, flaxseed, field peas, soybeans, grain sorghums, spelts, and other products that are usually stored in grain elevators. This excludes such seeds after being processed and the products of such processing when packaged or sacked.

Handling is defined as the receiving of grain at or in each elevator, warehouse, mill, processing plant, or other facility in this State in which it is received for storage, accumulation, sale, processing, or for any purpose whatsoever.

Assumptions

The Bill is effective July 1, 2024 (FY 2025).
Taxes based on assessments for a given assessment year (AY) are credited in the fiscal year beginning in the subsequent calendar year.
The Department of Revenue reports that the statewide amount of grain handling tax collected for AY 2023 was $1.2 million. The amount of grain handled is assumed to remain steady over the forecast period.