Identical proposals in the Missouri House and Senate would overhaul Missouri’s tax code and slash more than a billion dollars in state revenue.
In a nutshell, the bill would lower the top state income tax bracket to 4.8 percent, which is lower than the tax cut that passed three years ago capping the top rate at 5.5 percent. The proposal would also completely exempt anyone who makes less than $4,000 a year from paying state income taxes.
Republican Bill Eigel of Weldon Spring has pre-filed the bill in the Senate.
“The reason I think that any Missouri worker should care about this bill is because right now that Missouri worker — from a variety of different tax sources, be it income taxes, sales taxes, property taxes — are sending more of their money to Jefferson City than they ever have before,” Eigel said. “I’m a big believer that we can make our government a bit more efficient, that we can do a better job with the money that’s coming in, and we can actually ease that burden on the Missouri taxpayer.”
In return for the lower income tax rate, the bill would cap the total amount of tax credits doled out each year at $425 million. It also specifically addresses the low-income housing tax credit by capping it at $135 million a year.
The proposal would also raise the state’s fuel tax to 23 cents a gallon. At 17 cents a gallon, Missouri’s currently one of the lowest fuel taxes in the nation.
“This is probably by no means the perfect bill that’s gonna get passed as is, but we’re gonna have a long discussion about what this looks like,” said Rep. Travis Fitzwater, R-Holts Summit. “I know I have colleagues in the House and the Senate that have their own proposals; I talked to the governor’s office yesterday (and) they also have a proposal coming out.”
Fitzwater’s bill has not been pre-filed yet, but he said it’s identical to Eigel’s Senate bill.
Democratic lawmakers have not responded yet to requests for comment on the proposed tax overhaul. They were highly critical of the 2014 tax cut, saying it would drain much-needed revenue from public schools and health care needs.
The 2018 session begins next month.
Follow Marshall Griffin on Twitter:@MarshallGReport