EYE ON Iowa Sales Taxes

The Iowa retail sales and use tax is imposed on the sales price of all sales of tangible personal property as well as numerous services.  

The Iowa state sales and use taxes are imposed at the rate of 6%. Localities can impose additional taxes which are administered by the state. 

Iowa conforms to the provisions of the Multistate Streamlined Sales and Use Tax Agreement (SSUTA).

For all participating states, the SSUTA sets uniform definitions of sales and use tax terms, a central registration system, simplified local sales and use tax collection procedures, and uniform standards for:

(a) the sourcing of transactions to taxing jurisdictions;

(b) the administration of exempt sales;

(c) the allowances a seller can take for bad debts; and

(d) sales and use tax returns and remittances.

Except for its tendency to tax a host of services, Iowa is a relatively taxpayer friendly state.  The highest combined state and local sales tax rate in the state is 7%.