The Missouri Senate passed a tax cut bill, after two different versions were blocked by Republicans who opposed a compromise between the GOP sponsor and Gov. Jay Nixon, a Democrat.
Senate Bill 509 would cut the individual income tax rate from 6 percent to 5.5 percent and phase in a 25 percent deduction on an individual's business income. The changes would not take effect until 2017. The bill is sponsored by state Sen. Will Kraus, R-Lee's Summit.
"As Missouri continues to fall further behind other states, 18 states last year cut taxes (and) two cut taxes this year," Kraus said. "This bill is a people's tax cut – this is a bill that sends taxpayer dollars back to the people, put(s) more money in the economy, and will grow the economy."
Earlier versions of Kraus' bill would have triggered tax cuts only when Missouri's K-12 schools become fully funded. It also would have capped tax credits for historic preservation and low-income housing, as per his compromise with the governor. State Sen. Paul LeVota, D-Independence, spoke against the latest version of the bill on the Senate floor.
"The governor has been very clear that we need to protect our revenue and make sure that we're able to pay for the things, like schools and roads and other things, that we need," LeVota said. "We cannot reduce our revenue to the detriment of our schools and other things, and this bill does that."
In addition, the governor blasted the latest version of SB 509 in a written statement issued this week:
"At a time when public education is more important than ever to the strength of our economy, Senate Bill 509 would permanently undermine Missouri's ability to support K-12 and higher education. In fact, with a price tag of more than $620 million annually, Senate Bill 509 is the equivalent of wiping out the investments needed to fully fund our K-12 foundation formula and keep college affordable. Once again, the choice facing members of the General Assembly is clear: they can invest in good schools and create good jobs or they can support reckless fiscal experiments, but they cannot do both."
The bill now goes to the Missouri House, which passed its version of the tax cut proposal back in February. That bill, HB 1253, is scheduled to be heard by a Senate committee on Thursday.
Follow Marshall Griffin on Twitter: @MarshallGReport