No surprise here, Governor Culver is asking the Iowa Department of Revenue to hold off on collecting tax refunds that were issued to flood victims. This comes after the realization that these victim's were taxed on the refunds thanks to Legislative Democrats and the Governor choosing not to couple the Iowa tax code with the federal tax code.
During the legislative session, Democrats had ample opportunity to couple the codes but they chose not to. Now, as the governor is publicly ramping up his re-election campaign, he wants to backtrack, safe face and not punish these flood victims. Too little too late if you ask us. With a $160 million revenue shortfall in the Iowa budget, Democrats need the taxes. We don't see this problem going away anytime soon.
Here's the TV story explaining the problem.