Iowa law exempts qualifying nuclear plant work from sales tax

Qualifying nuclear facilities receive sales and use tax relief for certain purchases and services. The relief covers Iowa facilities licensed by the federal nuclear regulator that begin or restart at least one unit on or after January 1, 2028. Covered work includes building, repairing, maintaining, safely storing, or restarting a facility. The purchases or services must be directly and mainly used for work that results in a new facility, increased capacity, or a restart of a closed facility. For no more than four years of the exemption period, a facility must contribute $2,200 yearly for each megawatt it is approved to produce. If it misses a required contribution, it must repay exemptions and refunds claimed that calendar year. If the facility does not begin or restart commercial operation within 12½ years of the later of its state certificate or first safety-related concrete, it must repay covered exemptions and refunds, minus its contributions. For restart preparation, the exemption covers eligible purchases and services on or after January 1, 2026, until commercial operation begins or restarts. For other covered work, it starts when permitted by the facility’s agreement with the state and ends when commercial operation begins or restarts.

The Board of Regents uses money in a dedicated fund for nuclear workforce programs and equipment at its colleges and universities. The fund is controlled by the Iowa Board of Regents and supports programs at one or more higher education institutions governed by the board. The board must consider recommendations from the Iowa nuclear energy task force when deciding how to support programs. Beginning January 15, 2028, the board must report to the legislature each year on student and educator participation and how it allocated program funds.