Iowa business climate - Iowa Area Development Group

Iowa's corporate tax law is specifically designed to provide your business with a distinct operational advantage. These programs and others create a positive and profitable business environment, making Iowa the smart choice for your business.

Iowa Corporate Income Tax
A number of features of Iowa's corporate income tax offer significant advantages when compared to other states' corporate taxes.
- Fifty percent deductibility of federal taxes from Iowa corporate income tax.
- Single-factor, non-unitary tax. Iowa's tax is based only on the percentage of total sales income within the state.
- Iowa corporate income tax may be reduced or eliminated by the New Jobs Tax Credit and the Enterprise Zone Tax Credit.
No Sales or Use Tax on Manufacturing Machinery and Equipment Purchases
The purchase of industrial machinery and computers assessed as real property and used for manufacturing or used to process data by insurance companies, financial institutions or certain commercial enterprises, is exempt from Iowa sales or use tax.
No Property Tax on New Industrial Machinery and Equipment
Manufacturing machinery and equipment, as well as computers used to process data by insurance companies and financial institutions is exempt from property tax. Pollution control equipment is eligible for exemption from property tax.
No Personal Property (Inventory) Tax
Personal property is not assessed for tax purposes. In Iowa, personal property includes corporate inventories of salable goods, raw materials and goods-in-process
No Sales and Use Tax
No sales tax is due on purchases of electricity or natural gas used in the manufacturing process.
Iowa is a Right-to-Work State
Under Iowa law an employee may not be required to join a union or pay dues or fees to any labor union, association or organization as a condition of employment.
Unemployment Insurance
Iowa has one of the lowest, new employer, unemployment insurance rates in the nation. The rate for all non-construction businesses is 1% for a 3 year period.
Workers' Compensation Cost
Iowa's workers' compensation costs are the 9th lowest in the nation. The average cost of workers' compensation insurance for manufacturers in Iowa is 30% lower than the national average.
Regulatory Assistance
The Regulatory Assistance Program enhances the range of services available to Iowa companies by advising and assisting companies in the preparation and submission of permit application with the Iowa Department of Natural Resources (DNR) and other Iowa regulatory agencies. The mission of the Regulatory Assistance Program is to facilitate communication between the business and regulators and to expedite the permitting process.