Democrats in the Missouri House unveiled on Monday their proposal to cut taxes, as Republican leaders prepare to attempt another major tax cut.
Currently, the top state income tax rate in Missouri is 6 percent. The Democrats' proposal, House Bill 1328, would lower that rate to 4 percent for residents earning $30,000 a year or less. Those earning just over $30,000 up to $300,000 a year would still pay a 6 percent rate, while the rate for those earning more than $300,000 a year would rise to 8 percent. The bill is sponsored by state Rep. Jon Carpenter, D-Gladstone.
"We feel that the bill will be revenue neutral or very close to it," Carpenter said. "Whereas House Bill 253 last year would cut well over 10 percent of general revenue out of the state budget, this is going to be within 1 percent (in) either direction, so we feel comfortable calling it revenue neutral."
The proposal would also cap federal income tax deductions on state income tax forms but increase the size of deductions for those earning less than $15,000 a year. In response, House Speaker Tim Jones, R-Eureka, says the proposal shows that Republicans are winning the battle of ideas.
"I'm very happy to see the House Democratic Caucus agree that cutting taxes will help fuel growth for our state's economy," Jones told reporters Monday. "That helps creates jobs and moves more Missourians toward prosperity."
Jones declined to talk about specific provisions within the Democrats' proposal, but he did say that taxing the so-called rich often ends up harming small business owners.
Last year's GOP-backed bill would have cut the personal income tax rate from 6 percent to 5.5 percent, while providing deeper cuts for corporations. It was vetoed by Gov. Jay Nixon, a Democrat, who then successfully campaigned against efforts to override his veto.
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