Archive for the ‘Iowa’ Category

Hawaii Likely to Increase Film Credits; What Could Go Wrong?

Monday, May 2nd, 2011

Do you like Hawaii Five-0? No matter, it’s very likely you will see far more films and television productions made in Hawaii in the near future. The legislature in Hawaii is considering increasing the film credit rate from 15% to 35% in Oahu and 20% to 40% on all other islands. One film company has a goal of ten movies and two television shows a year! It sounds great, as it would lead to thousands of jobs. What could go wrong?

Plenty. Joe Kristan has been covering the Iowa film credit scandal; see, for example, this update from last week. Let’s just say when there’s a lot of money involved, there’s the urge by some to stick their hands in the cookie jar. Perhaps this won’t happen in Hawaii, but instead of making Hawaii a better place for filmmakers, why not lower the tax rates for everyone so that Hawaii encourages all industries to locate their. A far simpler solution than targeted tax breaks, but its also one that usually can’t lead to corruption.

Not All Publicity Is Good Publicity

Tuesday, March 23rd, 2010

There’s an old saying, “All publicity is good publicity.” Sometimes, though, it’s not. Especially if you’re a Bozo.

Take Scott Mitchell, the owner of Central Iowa Amusements. Mr. Mitchell’s company got some good words in the Des Moines Register; his company had $464,676 of revenues from touch screen lottery terminals in Iowa. Unfortunately, Mr. Mitchell neglected to tell his accountant about that income. Even more unfortunately for Mr. Mitchell, the IRS does read the newspaper. Mr. Mitchell is likely heading to ClubFed after being found guilty of tax evasion.

Joe Kristan has more.

Why Is Iowa Looking at Allowing Major Poker Tournaments?

Sunday, January 24th, 2010

Iowa House Majority Leader Kevin McCarthy (D-Des Moines) is proposing legislation to allow large poker tournaments in ballrooms at the state’s 17 licensed casinos. Given my vocation and avocation I’m always happy to see an expansion of poker in the United States. But the cynic in me did have to wonder if this was done for helping poker or for some other reason.

The cynic in me was correct. Mr. McCarthy is looking at ways of increasing tax revenues to help Iowa’s budget situation. Mr. McCarthy said, “We’re looking at ways that would be win-win for the institutions, the communities and the state.” I’ll translate that: We’re looking at a way of increasing tax revenues. Since I can’t add video poker terminals (that was voted down by the Iowa legislature) this looks like a way I can increase revenues so I can spend more money.

Perhaps I am just a little too cynical about Mr. McCarthy’s motives. However, this appears to be yet another case where the cynics are right.

Iowa Flooding

Sunday, June 15th, 2008

The floods in Iowa have hit the tax blogging community. Joe Kristan, the blogger at Roth Tax Updates, and all of downtown Des Moines were evacuated Friday afternoon because of the floods.

The American Red Cross
is one good place to make a donation for flood relief.

The Pumpkin Tax Is No More

Thursday, November 1st, 2007

Food and food ingredients are defined as substances that are sold for ingestion or chewing by humans and are consumed for their taste or nutritional value.

So reads the Iowa Department of Revenue’s policy on what is food. Why is this important? Because the Iowa Department of Revenue decided (apparently in 2006) that pumpkins are mainly sold for decoration, and that sales tax should apply on those pumpkins sold for decoration but not on those sold for food.

I can just imagine a conversation at a supermarket in Des Moines. “Mrs. Smith, are you buying that pumpkin to eat or for decorating your front porch on Halloween?”

And what would the Iowa Department of Revenue think about someone who bought a pumpkin for both decorating and for food? Tax only half the pumpkin?

Yesterday, stories about the tax began circulating on the Internet and mass media (Google News showed 287 stories on the topic).

Luckily, some sanity has hit Iowa. Governor Chet Culver announced, “It has come to my attention that a policy change made in December of 2006 – before I took office – is resulting in this ridiculous pumpkin tax. I have directed the Department of Revenue to do the common-sense thing and suspend collection of this tax and offer refunds to consumers or retailers who have been affected.”

Increase Casino Tax Rates Or Increase Casinos?

Monday, March 13th, 2006

That was the decision Iowa was faced with after the Iowa Supreme Court ruled that tax rates at race track (horse racing) casinos were unconstitutional in 2004. Today, Iowa is in the midst of a casino building boom, with four new casinos opening and many existing casinos undergoing renovations.

Of course, legislators when faced with a tax shortfall (or a tax being declared illegal/unconstitutional) try for some other means of raising the same revenues. Perhaps we can call it a “user fee.” Maybe some video lottery terminals will raise some money. Or let’s just add some casinos. I mean, can we actually consider cutting spending? Of course not.

The beneficiaries of this policy are obvious: the casinos, Indian tribes operating some casinos, the State of Iowa (those tax revenues are still flowing), and in one sense, the gamblers in Iowa. After all, with the renovations and new facilities, it’s easier to gamble and it’s more comfortable (or soon will be).

Of course, it’s hard to win in most gambling, as the odds are with the house. You could try playing poker (several casinos in Iowa offer real poker). I’d advise reading a book first (shameless self promotion: I’m the co-author of a book on no-limit hold’em), as most poker players are losers.

So what’s the moral of the story? In most jurisdictions, government will find a way to make sure those tax revenues keep coming in.


News Story: Des Moines Register


Iowa Supreme Court Decision

Roth Tax Updates Story on Iowa Supreme Court Decision