Hunter
08/07/25
Iowa City voters will get to decide on whether they want a 1% local option sales tax.
The City Council unanimously approved a resolution this week that will put the proposal on the November ballot.
A simple majority is required to pass the tax, which would go into effect July 1st 2026. By law, half of the revenue must be used toward property tax relief, with the remainder up to the city.
The city council proposed that 25 percent would be earmarked for affordable housing, 10 percent towards infrastructure, and the rest to be used toward community partnerships.
Iowa City and Ankeny are the only two cities in the state with population of more than 50,000 that do not have the 1 percent local-option sales tax in addition to the statewide 6 percent tax.
Iowa City would join Swisher, Solon, Lone Tree, Hills, Tiffin and University Heights, who already have the local option sales tax. North Liberty residents will also vote on their local option sales tax this November, and Coralville’s City Council is planning to get language approved for the ballot initiative later this month.