The Iowa Senate passed a tax relief bill last week, which lawmakers say will help put money back into the pockets of Iowans and drive more economic business.

District 24 Senator Jerry Behn says the bill proposes cutting individual income tax rates by 30-percent, which he adds would cut on average $1,000 per year for the taxpayer. By lowering the individual income tax rate, Behn believes the savings will be used to re-invest in a business, in the community or saving it for college tuition.

Behn points out another area they looked at are corporate tax credits. He says there’s been criticism that using so many tax credits is the primary reason why the state is currently in a budget shortfall.

“Well one of the reasons those tax credits have been fairly successful is because our taxes are relatively high in this state. So it encourages investment in a certain direction, I refer to it as picking ‘winners and losers.’ If we can lower the rates, and lower the total taxes, and make us more competitive-both the corporate tax rate and the personal tax rate-then you don’t need those tax credits to incentivise individuals to come to the state and to do business here.”

The bill proposes lowering the corporate tax rate from 12- to 7-percent. Behn states that they are looking over every tax credit that is available in the state and are willing to make adjustments to them as the bill progresses in the legislature.