Iowa Admin. Code r. 701-251.2
A tax at the rate of 5 percent is imposed on the rental price of any automobile if the rental transaction is taxed under Iowa sales or Iowa use tax law. The tax imposed is in addition to the Iowa state sales or use tax.
See rule 701-26.68 (422) for a description of automobile rentals which are subject to Iowa sales tax and rule 701-33.8 (423) for a description of automobile rentals which are subject to Iowa use tax. These rules should be used with care since they involve vehicles other than an "automobile" as that word is defined for the purpose of this chapter. For instance, rule 701-26.68 (422) is concerned with boats and recreational vehicles as well as automobiles and other vehicles subject to registration. Summarizing the essential content of those rules regarding automobiles:
Iowa Admin. Code r. 701-251.2