The Iowa Legislature adjourned Saturday after passing a tax system overhaul long sought by business groups.

Iowa had been dinged in some business conditions ratings because the tax code had elements that made the corporate tax rate look relatively high compared with other states. This year’s action also phases out the ability to deduct federal taxes on state returns — a move that also should make tax rates more competitive, lawmakers said.

Lawmakers also approved one of the largest rounds of spending on water quality in recent history.

Of course, the two major parties disagree on whether those actions are cause for celebration. The Republicans who control both houses and the governor’s office called the session “historic” with landmark action that will make Iowa more competitive on economic development and workforce attraction. Democrats said the tax cuts will mean eroding services and even tighter state finances, and they considered the water quality bill a half-measure. The Cedar Rapids Gazette and the Des Moines Register reported lawmakers’ assessments.

Reactions from others continue to pour in, including:

Joe Murphy, Greater Des Moines Partnership: “We’re very pleased with how the Legislature’s session turned out. It’s good to see the lawmakers come together and be thoughtful on tax reform, with the lowering of the corporate rate and a commission to look at tax credits in the future. This moves us in the right direction on making Iowa more competitive in attracting business. We were glad to see the Future Ready Iowa Act [which is designed to help train the workforce]. The water quality bill was one of the premier actions as well, and a second action made it clear that corporate organizations can be involved. This is a generational issue, as lawmakers have noted, and that is admirable. We will remain engaged in that issue in the future.”

Iowa Association of Business and Industry: “The Legislature, which is controlled by Republicans in both the House and Senate, followed up last year’s historic session by passing additional pieces of pro-business legislation.”

Americans for Prosperity-Iowa: “Americans For Prosperity-Iowa applauds the desperately needed tax reforms passed today, but finds a fatal flaw in the new plan. Lawmakers in Iowa passed state tax reforms that are an important step toward putting the Hawkeye State on a path to economic prosperity, but include a 4 percent revenue growth trigger that will keep the state from fully realizing the benefits of lower tax rates.”

Iowa Farm Bureau Federation President Craig Hill: “Iowans agree that water quality improvement is a shared goal, and the passage of legislation with dedicated water quality funding is a historic milestone which will allow Iowa to continue to make big strides toward advancing water quality and soil health. Farmers are taking on the challenge of improving water quality, and we are excited to have the support of Governor Reynolds and the Legislature as we continue this important work with all Iowans to protect water quality and soil health.” 

Farm Bureau also noted that lawmakers passed legislation that “will provide Iowans access to a health care benefit that is more affordable than the current unsubsidized premiums under the Affordable Care Act (ACA).  The legislation continues a decades-long partnership between Farm Bureau and Wellmark to provide health coverage to Iowans.”

National Federation of Independent Business Iowa State Director Matt Everson: “Our research shows that tax reform at the federal level has created a surge of optimism for small businesses, which is leading to amazing economic growth, and over time Iowa will see similar benefits with this plan. When small-business owners have less of a tax burden, it’s proven they invest that money back into their companies, creating new jobs and sending more tax dollars back to the state.”

“Along with lower income tax rates, the new expensing and deduction rules will also help small-business owners keep and invest more of their own money for expansion and higher wages for employees,” added Everson. “Iowa has become known as a high tax state, but this will gradually turn the tide. It will make our state a much more attractive place for a business to relocate or open. It sends a strong signal that Iowa is open for business.”