Business Climate

Iowa: Among the Nation’s Best for Business

A right-to-work state, Iowa has a strong track record of enacting progressive, pro-business legislation that creates favorable conditions for both existing companies and those taking a look at what the state has to offer. In addition, the state provides programs and resources to assist new and expanding businesses with business development funding, tax credits and programs, workforce recruitment and training, regulatory compliance and licensing, innovation support, exporting and international business development and more.

A proactive and responsive business tax, regulatory and legal framework position Iowa among the nation’s most “business friendly” states.

Iowa's nine largest metropolitan areas all ranked among the best places in America to start a business or career.


Iowa perennially ranks among the best states for cost of doing business.

Iowa’s corporate income tax is a single-factor, non-unitary tax, based only on the percentage of total sales income within the state; multiple tax credit programs and a 50 percent deductibility of federal taxes further eases the state’s corporate tax.

There is no personal property tax in Iowa for corporate inventories of goods-in-process, raw materials or salable goods in Iowa.


No sale or use taxes are charged on purchases of industrial machinery, equipment and computers used for manufacturing in Iowa; nor are these items subject to property taxes.

Iowa does not charge premium taxes on the sales of annuities or qualified life insurance plans, and the state does not assess any additional surtaxes or income taxes on insurance carriers.

At just one percent, Iowa's insurance premium tax is one of the lowest rates in the nation

Iowa workers’ compensation premium rates are 11 percent lower than the national average.

One of only a few states to offer refundable research activity credits, Iowa is driving innovation into industry with 180 corporations and 860 individuals claiming $48.3 million in tax credits last year.

Venture capital funds innovation and Iowa is among the nation’s leaders in terms of average amount invested. During the past five years, Iowa ranks second in the U.S. with the average investment deal more than 20 percent larger than the U.S. norm.