Amendment 4: Realtors lead pre-emptive strike against expanding sales taxes to include services | St. Louis Public Radio

Amendment 4: Realtors lead pre-emptive strike against expanding sales taxes to include services

Oct 13, 2016

As the Missouri Realtors group sees it, it’s just being proactive.

The state of Missouri doesn’t generally impose sales taxes on services. But some legislators and political donors, notably Rex Sinquefield, have for years floated the idea of expanding the state’s sales tax so they can cut or eliminate Missouri’s income tax.

Missouri Realtors and its allied groups want to kill that notion in its tracks.

At a rally this week in Kirkwood, Realtors chief executive John Sebree explained – and noted that real-estate commissions are among the services that could be taxed.

Yard signs in favor of Amendment 4, which would bar state sales taxes on services
Credit Jo Mannies/St. Louis Public Radio

“We felt some time ago that we needed to be proactive," Sebree said. “Get something in the Missouri constitution so that, moving forward, no legislature could tax the service that is your haircut, that is your rent.”

The pro-amendment coalition includes the Missouri Bankers Association, the Mortgage Bankers Association, the National Federation of Independent Business and the Missouri Chiropractors Association.

Court case contributes to effort

Scott Charton, a consultant for the pro-Amendment 4 group, points to a recent decision by the Missouri Supreme Court against the St. Louis-based company, Alberici Constructors Inc.

Alberici had challenged the sales taxes that the state Department of Revenue said it had to pay on rentals of industrial cranes, and their delivery. The court ruled in favor of the department.

Area real-estate agents gather at rally in Kirkwood in favor of Amendment 4.
Credit Jo Mannies/St. Louis Public Radio

Charton said there’s concern among business groups, and others, that state bureaucrats will continue to expand the services when sales tax payments are required. That’s among the reasons, he said, that so many business groups have joined together in favor of Amendment 4.

The Missouri Municipal League is opposing Amendment 4, in part because of its wording. Deputy director Richard Sheets said in an interview, “We’re concerned that future interpretations by the court would make this much broader.”

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Sheets said that the league was disturbed that it wasn’t consulted about the wording, or about the reasons for the amendment.

“There’s not a serious attempt to expand our sales tax into services,” Sheets said. “We believe this is a solution looking for a problem.”

But the league doesn’t plan to conduct a high-profile campaign against Amendment 4, in part because it doesn’t have the money. Instead, Sheets said it will rely on its members to circulate the group’s objections.

Meanwhile, the Missouri Realtors set up a political action committee that has collected at least $180,000 to pay for what's largely a grassroots campaign with fliers and yard signs. The coalition is increasingly confident that the amendment will pass easily on Nov. 8.