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"AN EVEN CRAZIER IDEA IN IOWA"

April 11, 2005

A stylishly-coiffed David Brunori, the Tax Analysts state tax policy wonk, weighs in on the bill to let the proposed Newton raceway keep the sales taxes it collects:

AN EVEN CRAZIER IDEA IN IOWA

The Iowa Senate Tax Policy Committee approved a bill that would provide a unique tax break to a planned race-car track in the state. If the bill becomes law, the owner would be able to keep up to $12.5 million of sales tax collected at the track over the next 10 years.

The state would still be imposing the sales tax on things sold at the track. But the vendors would get to keep the money. I wonder if the vendor would get a fee for collecting the sales tax as well. I wonder if the vendor would now lobby for higher sales tax rates. That's what I would do. Is this a dumb idea? Sure it is. If the state wants to assist the owner, it should appropriate money every year.

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