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Reminder for Iowa City businesses: Local Option Sales Tax will expire June 30

Beginning July 1, sales tax in Iowa City will drop to 6%.

The 1% Local Option Sales Tax (LOST) that Iowa City voters approved four years ago to help raise funds for flood recovery and protection efforts is set to expire at the end of June. Beginning July 1, Iowa City businesses should no longer collect the tax, which helped raise more than $34 million for flood mitigation projects during its duration. The sales tax will drop on July 1 to 6%, down from the 7% level established when the special sales tax was in effect.

The tax, which was implemented July 1, 2009, has helped provide the City's share of funding for two major public infrastructure projects: the relocation of the North Wastewater Treatment Plant at 1000 S. Clinton Street, and the "Gateway Project," which will elevate a flood-prone section of Dubuque Street and reconstruct Park Road Bridge.

Additional information is available at and Business owners or managers who have specific tax questions should e-mail For additional information about the local impact of the special sales tax, contact the City Manager's Office at 319/356-5010.


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