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Iowa General Fund receipts down 7.9% through March 3 as PTET reallocations depress revenues
Summary
A monthly video memo from the nonpartisan Iowa Legislative Services Agency reported a $461 million, 7.9% drop in General Fund receipts through March 3, 2025, driven largely by pass-through entity tax (PTET) timing and reallocations; an individual income tax rate cut effective Jan. 1, 2025, could further slow receipts.
Eric Richardson, senior fiscal analyst with the Iowa Legislative Services Agency, said March 3 receipts for the Iowa General Fund fell by $461 million, a 7.9% decline for fiscal year 2025 year to date.
Richardson said two of the three main revenue sources rose year to date: individual income tax was up 2.7% and sales and use tax increased 1.9%, while corporate income tax receipts fell 20.9%. Insurance and other taxes decreased by $455 million (68.4%), a change Richardson attributed primarily to a decline in pass-through entity tax, or PTET, receipts.
The PTET was introduced in fiscal 2024 with retroactive effect to tax year 2022, Richardson said, which resulted in most PTET…
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