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Government, Politics & Issues

Nixon warns legislators, overriding veto of car-tax bill could be costly to owners

This article first appeared in the St. Louis Beacon, Aug. 27, 2012 - Missouri Gov. Jay Nixon, a Democrat seeking re-election, has sent a letter to each member of the Republican-controlled General Assembly, warning that any effort to override his veto of an auto-tax bill could result in tax hikes to more than 120,000 Missouri car owners.

The implicit message to legislators? Do you really want to raise taxes on 120,000 potential voters right before an election?

And Nixon has a conservative ally. The fiscally conservative group United for Missouri also has called for the legislature to back off any any override attempt.

The annual legislative veto session is to begin Sept. 12.

Nixon’s letter pertains to HB 1329, which passed the legislature this spring. The bill was in response to the Missouri Supreme Court's decision March 21 that tossed out local taxes on vehicles purchased out-of-state unless the local jurisdictions had voted for such a tax.

Missouri car dealers, especially those near the borders, lobbied legislators to reinstate the local tax from car dealers. The dealers said their business was suffering because Missourians were crossing state lines to buy vehicles to avoid potential hundreds of dollars in local sales taxes.

The bill's Republican sponsors saw the bill’s passage as a way to reinstate the local taxes without a public vote. But even before the session ended, Nixon had telegraphed his likely veto, saying that such action was improper. Both sides have traded assertions of playing politics.

Nixon noted that the bill specifically stated that the taxes were to be restored “retroactively” on all purchases since the Supreme Court decision.

He said in his letter that he had asked the Missouri Department of Revenue, which handles vehicle-related matters dealing with registration and taxes, to therefore determine how many people had purchased vehicles since March 21 and who, presumably, had not been assessed any local sales taxes.

The department reported that 122,702 purchasers fit that definition.

Nixon wrote in his letter that if his July veto of HB 1329 is overridden, “all of those transactions would be subject to local tax retroactively, and the process for sending tax due notices to those taxpayers would begin immediately” to notify them that they now “would be forced to pay an additional and unexpected local tax. “

The governor added, “It is unfair and punitive to retroactively tax at least 122,702 Missourians, particularly without a vote of the people.”

What he didn't say, but made clear, was that those tax notices would go out before the Nov. 6 election.

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