The state of Iowa’s state sales tax rate increased to 6% beginning July 1, 2008. Sales tax is due on the retail sale, lease or rental of most goods and some services. Local jurisdictions may impose an additional local option tax of 1%.
Use tax is also collected on the consumption, use or storage of goods in Iowa if sales tax was not paid on the purchase of the goods. The use tax rate is the same as the general sales tax rate. Returns are to be filed on or before the 20th day of the month following the month in which the purchases were made. For example, purchases made in the month of January should be reported to the state of Iowa on or before February 20th.