DES MOINES — Students would not have to pay Iowa sales tax on college and university textbooks under a bill that won unanimous committee approval Tuesday.
The House Ways and Means Committee approved House Study Bill 683 23-0 to send it to the full House.
It would exempt textbooks sold at all Iowa public and private colleges and universities, including the three universities operated by the Board of Regents.
Sales tax must still be charged on other materials sold by the bookstores — everything from books and supplies to sweatshirts, face tattoos, dog bowls and stuffed animals, Rep. Bobby Kaufmann, R-Wilton, said.
The bill was crafted following news reports that tens of millions of dollars of sales went untaxed at the three state universities. Privately owned retail stores said it was difficult to compete with campus stores that did not charge the 6 percent sales tax.
Kaufmann said it was never the intent of lawmakers that personal goods — caps, coffee mugs and sport paraphernalia — would be exempt from the state sales tax.
However, university lobbyists said campus bookstores at Cedar Falls, Ames and Iowa City have not been charging sales tax on any items because that’s what officials with the Department of Revenue advised them to do.
While students “should appreciate what we’re doing here today,” Rep. Todd Prichard, D-Charles City, said lawmakers must address funding decisions that led to tuition increases by the regents.
Earlier this month, the board announced a 3.8 percent hike at University of Iowa and Iowa State University and a 2.8 percent increase at University of Northern Iowa.
“We need to be looking as a committee at that bigger picture and be mindful of the expense of regent universities,” he said. “We start to put that educational opportunity out of reach of Iowa working families and people who want to further their education.”