Fiscal Note
Fiscal Services Division
HF 2628 – Sales Tax Exemption for Nonprofit Blood Centers (LSB2505HZ)
Staff Contact: Evan Johnson (515.281.6301) evan.johnson@legis.iowa.gov
Fiscal Note Version – New
Description
House File 2628 expands the current sales and use tax exemption allowed for nonprofit blood
centers to exempt any tangible personal property or specified digital products sold and any
services furnished to a blood collection and processing establishment.
A blood collection and processing establishment is defined as a place of business under one
management at one general physical location and includes human blood and plasma donor
centers, blood banks, transfusion services, and other blood product manufacturers and
independent laboratories that engage in quality control and testing for registered blood product
establishments.
Background
2019 Iowa Acts, chapter 141, provided a narrower exemption for nonprofit blood centers. Under
current law, tangible personal property sold or test laboratory services furnished that are directly
and primarily involved in the processing of human blood are exempt from sales tax for nonprofit
blood centers in Iowa that are Food and Drug Administration (FDA)-registered. According to the
Fiscal Note on 2019 Iowa Acts, chapter 141, there are two nonprofit blood centers affected by
the current sales tax exemption.
Assumptions
• The same nonprofit blood centers currently exempt will be exempt from sales tax on all
tangible personal property sold, specified digital products sold, and services furnished under
the Bill.
• According to the Department of Revenue and utilizing Internal Revenue Service (IRS) 990
reports for calendar year 2019, an estimated $2.9 million in additional purchases would have
been exempt under the Bill in FY 2020.
• Growth trends are based on the Consumer Price Index (CPI-U) less food and energy
average estimated increases of 2.0% from FY 2025 to FY 2029.
• Secure an Advanced Vision for Education (SAVE) refunds are 1.0% of taxable sales. Local
option sales tax (LOST) distributions are estimated to be 0.97% of taxable sales.
Fiscal Impact
House File 2628 is estimated to reduce revenues to the General Fund, SAVE Fund, and LOST
by the estimated amounts in Figure 1.
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 Figure 1 — Fiscal Impact of HF 2628 (in Millions)
General Fund SAVE LOST
FY 2025 $ -0.18 $ -0.04 $ -0.03
FY 2026 -0.18 -0.04 -0.04
FY 2027 -0.19 -0.04 -0.04
FY 2028 -0.19 -0.04 -0.04
FY 2029 -0.20 -0.04 -0.04
Sources
Iowa Department of Revenue
Internal Revenue Service 990 filings
/s/ Jennifer Acton
February 29, 2024
Doc ID 1447239
The fiscal note for this Bill was prepared pursuant to Joint Rule 17 and the Iowa Code. Data used in
developing this fiscal note is available from the Fiscal Services Division of the Legislative Services
Agency upon request.
www.legis.iowa.gov
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Statutes affected:
Introduced: 423.3