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Lawmakers eye sales-tax repeal for textbooks

BY SHAWN GUDE | FEBRUARY 26, 2009 7:37 AM

Cash-strapped students know the biennial feeling all too well.

After searching through the crowded bookstore for their textbooks each semester, they stare at the cash register, dreading the inevitably astronomical total for those few hundred pages.

Looking to allay some of those costs, several Iowa legislators have drafted bills to exempt college textbooks from the sales tax.

Under current tax law, students who purchase textbooks from the UI’s University Bookstore are eligible for a sales-tax refund.

But several measures under consideration — two in the House and one in the Senate — would alter the current system and provide a uniform sales-tax exemption for textbooks bought in both private and university-run bookstores.

Textbooks for cosmetology and barber schools would also be exempt.

Despite its seemingly pro-student leaning, some UI students were skeptical about the underlying intentions and effectiveness of the bill.

“They’ll find another way to raise the price of books to pay for it,” said UI senior Leslie Amonoo, whose semester textbook bill typically ranges from $350 to $400.

Count UI junior Joan Gordon among the doubting Thomases as well.

“I think it’s a good idea to lower costs, I just don’t think it will lower it that much,” she said.

But UI sophomore Lauren Hardesty backed the bill, saying it would help self-sufficient students in particular.

“The price of books is ridiculous, and a lot of students have to pay for it themselves — I don’t know how they do it,” she said.

Rep. Dawn Pettengill, R-Mount Auburn, framed the measure as a way to provide much-needed relief to students and bolster the struggling economy.

“Students are already having a large outlay of money and textbook they have to pay for themselves,” said Pettengill, a cosponsor of a sales-tax exemption bill in the House. “The more money they have in their pockets, the better off our economy will be.”

Describing the current hodgepodge system as a bureaucratic mess, Sen. Herman Quirmbach, D-Ames, is the proposal’s chief sponsor on the Senate side.

Despite that perceived mess, Quirmbach, an economics professor at Iowa State University, implored students around the state not to remain complacent: Thousands of dollars in potential refunds go unclaimed because of a lack of knowledge.

While hundreds of ISU students have claimed their refunds, few UI students have taken advantage of the sales tax offer, according to an official at the Iowa Department of Revenue.

“The more refunds you claim, the less it will cost the state to get rid of the provision altogether,” Quirmbach added.

The bill is sure to meet opposition on both sides of the aisle in a year of budget concerns. Even cosponsor Sen. Joe Bolkcom, D-Iowa City, conceded the measure would be difficult to push through during this year’s budget crunches, regardless of the bill’s merits.

“It’s difficult in this current financial environment to give up this revenue, to remove the sales tax and forgo those dollars,” he said. “I think it’s a good piece of policy, but it’s always about balancing what you can afford to do vis á vis these kinds of tax cuts.”

Similarly, Quirmbach said, “I don’t want to get peoples’ expectations to an unreasonable level.”

The extent to which it would hurt the revenue stream is unknown. There hasn’t been a fiscal note written for the bill, though unofficial estimates diverged. Pettengill placed the price tag at $3 million to 4 million in revenue loss; Bolkcom said he sees it costing more.

Molly McAndrew, the government-relations liaison for the UI Student Government, said representatives from the three state universities have been working collaboratively to support the bill.

Mark Braun, UI President Sally Mason’s chief of staff, said it’s unclear whether the state Board of Regents will take a position on the proposal.

The subcommittee assigned to Quirmbach’s bill — which the Ames Democrat chairs — is scheduled to meet this morning.


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