IOWA BUSINESS CLIMATE INFORMATION

No Personal Property Tax
Personal property is not assessed for tax purposes. In Iowa, personal property includes corporate inventories of goods-in-process, raw materials and salable goods.

No Sales and 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. In addition, there is no sales tax on materials used in the manufacturing process or for purchases of electricity or natural gas used directly in the manufacturing process.

No Property Tax on New Industrial Machinery, Equipment and Computers
Manufacturing, machinery, equipment, and computers are exempt from property tax.

Tax Increment Financing
City councils or boards of supervisors may use the property taxes resulting from the increase in taxable valuation caused by the construction of new industrial or commercial facilities to provide economic development incentives to a business.

Worker's Compensation
Iowa's worker's compensation costs are among the nation's lowest. The average cost of worker's compensation insurance for manufacturers in Iowa is 25% lower than the national average.

Unemployment Insurance
Iowa has the lowest new employer unemployment insurance rates in the nation. In 2005, the rate for all new non-construction businesses is one percent.