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Flat rate. Indiana. 3.4. 3.4. 3.4. Flat rate. Iowa. 25.5% federal tax liability for income and cap gains. State rate applies to federal tax liability.. What to Do: Continue to remind legislators of the tremendous burden placed on business by the state's high income tax rates. Iowa is not competitive with.. to the Constitution of the State of Iowa relating to certain state tax rate changes.. A study bill relating

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