Iowa House Approves Flat Tax Bill

DES MOINES, Iowa (AP) - A proposal to give taxpayers the option of paying a flat income tax has the support of the Republican-controlled Iowa House.

The legislation was approved Wednesday in a 53 to 46 party-line vote.

The plan says taxpayers could pay a 4.5 percent tax on income instead of the current progressive tax. Most deductions and credits wouldn't be available to those paying the flat tax.

Supporters argue such a system would simplify the process. Opponents say a flat tax provides costly breaks to the affluent.

Lawmakers in the House amended the bill to include another proposal to use surplus budget funds to give credits to taxpayers. The surplus has been estimated at up to $800 million.

The legislation now moves to the Democratic-majority Senate, where it has little chance of support.
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