Iowa casinos are going head to head against their governor and this time they may lose. The problem is that Iowa is still depressed. Since the recession, Iowa has suffered economically. There are huge numbers of people still relying on unemployment throughout the state. They are questioning when the market will turn around and give them the chance to once again move into the market. It isn’t that they don’t want to work; it is that the jobs just aren’t there for them anymore. A recent study showed that for every job out there, there are twelve applicants. Plus many of the jobs available are finding few qualified workers to fill them. It is a difficult time for the job market in the state and this is what the governor wants to fix. In an effort to come up with a solution, Governor Branstad is proposing decreasing the amount of corporate taxation by fifty-percent to businesses within the state. He believes that if he can free up the money for the companies, they will then have the budgets to start hiring again. There are millions of dollars in tax savings if the taxes are cut by that much. Businesses until now have not had the chance to hire due to tight budgets. Since the recession, most businesses have had a hard time rallying. Having a huge tax break like this would definitely help them to revive their businesses that much quicker. Opening the door to a new job market would help the entire Iowan economy to revive too. But there is a problem…if taxes are cut for one market, that means the money has to be found elsewhere.
Governor Branstad is proposing that the money lost via a cut in corporate taxes be recouped by an increase in gambling taxes for casinos. He wants to raise casino’s current tax rate of 22% up to 36%. This is not sitting well with casinos in the state, whose operators believe that they already contribute more than their share of taxes to the state’s coffers. They believe that the tax rate would bring their tax revenue so high that it would be hard for them to manage. Developers building the Grand Falls Casino say that the increase would create a $8-million tax bill for them. The issue is far from settled, but it will be interesting to see what happens in the end.