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Bill > HF682

IA HF682

IA HF682
A bill for an act relating to the recapture of tax expenditures and disbursed by departments of the state to businesses that violate child labor laws.

summary

Introduced
02/28/2025
In Committee
02/28/2025
Crossed Over
Passed
Dead

Introduced Session

91st General Assembly

Bill Summary

This bill relates to the recapture of tax expenditures disbursed by departments of the state to businesses that violate child labor laws. The bill defines “tax expenditure” to mean the same as defined in Code section 2.48, which includes tax credits, exemptions, deductions, and rebates as well as sales tax refunds. Beginning on or after July 1, 2025, as a condition of authorizing tax incentives to a business under any of the programs administered by a department of the state, the value of the tax expenditure authorized shall be subject to recapture by the department if the business, or a contractor, subcontractor, or other third party of the business providing services to the business in the business’s facility, violated state or federal child labor laws under Code chapter 92 or the federal Fair Labor Standards Act of 1938. The bill requires the business to notify the administering department of the violation within 30 days of the ending of the time period to contest or appeal the violation. The bill specifies the repayment or recapture of tax expenditures pursuant to the bill shall be accomplished in the same manner as provided in Code section 15.330(2). The repayment of incentives pursuant to that Code section is considered a tax payment due and payable to the department of revenue, and the failure to make such a repayment may be treated by the department of revenue in the same manner as a failure to pay the tax shown due or required to be shown due. In addition, a county may take action to recover the value of property taxes not collected as a result of a tax exemption provided to the business.

AI Summary

This bill introduces a new mechanism for recapturing tax expenditures from businesses that violate child labor laws, effective July 1, 2025. Under the proposed legislation, if a business, its contractors, subcontractors, or other third parties providing services are found to have violated state or federal child labor laws (specifically those in Iowa Code chapter 92 or the federal Fair Labor Standards Act), the state departments that authorized tax incentives can reclaim the value of those tax expenditures. Tax expenditures are broadly defined to include tax credits, exemptions, deductions, rebates, and sales tax refunds. The bill requires businesses to notify the administering department within 30 days after the conclusion of any appeal period for a child labor law violation. The process for repaying or recapturing these tax expenditures will follow the same procedures outlined in existing state law (section 15.330, subsection 2), which treats such repayments like tax payments due to the department of revenue. Additionally, counties may take action to recover property tax exemptions that were previously granted to the business.

Committee Categories

Government Affairs

Sponsors (19)

Last Action

Introduced, referred to State Government. H.J. 479. (on 02/28/2025)

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