A new year means a handful of new laws taking effect around the country. Iowa is no exception. I decided to comb through the new laws that took effect in Iowa on January 1st, 2025 and highlight a few that I believe are the most impactful and consequential.

Here are four new laws that are presently in effect in Iowa with the start of the new year.

A Lower, Flat State Income Tax:

Per The Gazette, Iowa's top individual income tax rate has dropped from 5.7% to 3.8% for all tax payers. The new law accelerates a 2022 income tax overhaul. Republicans, who have had complete control of the state lawmaking process since 2017, have reduced the number of state income tax brackets in effort to make Iowa, as a state, more competitive.

They have referenced annual budget surpluses as evidence that Iowans are paying too much in state income taxes.

New Consumer Privacy Laws:

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Photo Credits: Canva
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Governor Kim Reynolds signed Senate File 262 into law on March 28th, 2023. The law, known as the Iowa Consumer Data Protection Act (IACDPA), is predicated on business-friendly consumer privacy protection, but is also missing a couple key attributes, per Global Privacy Blog's website.

The IACDPA applies to any individual or entity who either conducts business in Iowa or produces products/services that are targeted to residents in the state. The guidelines are as follows:

  • controls or processes personal data of at least 100,000 Iowa residents; or
  • controls or processes personal data of at least 25,000 Iowa residents and derives over 50% of its gross revenue from the sale of personal data.

You can read more about Iowa's new consumer data protection law here.

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Changes to Iowa's OWI Laws:

Now in effect, a person whose driver's license is revoked for operating a vehicle while intoxicated (OWI) is required to install the ignition interlock device before being issued a temporary restricted license. The device assures the operator of said vehicle is sober and clear to drive. It permits them to drive to work, school, the hospital, and other locations under certain conditions.

In addition, drivers must complete the designated time period without violations before the device can be removed and their license can be reinstated by the state. There are also changes in effect that extend the amount of time a person is required to have the ignition interlock device on their vehicle if multiple violations/infractions are detected.

A New "Bong Tax:"

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Photo Credits: Canva
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Finally, Iowa stores that sell paraphernalia that is commonly used to smoke marijuana and other drugs will face higher taxes and enhanced regulations. Products like glass and metal bongs and pipes will be taxed at 40%. The tax revenue will be used to create a fund for specialty courts/programs designed to address substance and mental health issues.

The new law also requires retailers to obtain a license in order to sell the aforementioned products. Retailers will need to pay a $1,500 permit fee to sell "any equipment or product, made in whole or in part of glass and metal, that is designed for use in inhaling through combustion tobacco, hemp, other plant materials, or a controlled substance."

As expected, no one under 21 is permitted to buy such products.

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Read more about these laws, and others, that are now in effect in Iowa as of January 1st, 2025 on The Gazette's website.

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