Missouri lawmakers pass big tax changes at end of session

2 years 2 months 3 weeks ago Friday, May 18 2018 May 18, 2018 Friday, May 18, 2018 4:18:00 PM CDT May 18, 2018 in News
By: The Associated Press

JEFFERSON CITY (AP) — Missouri's Republican-led Legislature approved tax cuts for both individuals and corporations Friday and sent a gas-tax hike to voters, just hours before the end of the regular session and beginning of a special one to consider impeaching Gov. Eric Greitens.


Lawmakers face a 6 p.m. deadline to pass bills in the annual regular session. Then, 30 minutes later, they plan to launch a special session to consider discipline against Greitens. He faces allegations of sexual misconduct during an extramarital affair in 2015 and that he raised money for his gubernatorial race by using a donor list without permission from a charity he founded. He has denied criminal wrongdoing.
While the governor's troubles have at many times overshadowed the legislative session, GOP leaders have continued to push to get work done despite the distraction.


In a last-minute blitz, lawmakers on Thursday and Friday pushed through several sweeping changes to the state tax code.


On Friday, the House voted 96-42 to pass a bill to cut the corporate income tax rate from its current 6.25 percent to 4 percent in 2020, a revenue loss that is estimated to be at least partially offset by a change in how multistate corporations can calculate their taxable income.


That would be paired with a separate tax cut for most individuals — if both measures become law. Under the individual income tax proposal, which passed Thursday, the top rate would drop from 5.9 percent to 5.5 percent starting in January. The top rate applies to most Missourians.


Individuals' income tax rate would gradually drop to 5.1 percent if the state meets revenue targets. To balance the loss in revenue from the tax cut, lawmakers proposed reducing a federal income tax deduction. Earlier estimates put the cost of the changes at a high of $5.8 million in fiscal year 2023, although that did not account for Senate amendments to the plan.


Lawmakers on Friday also sent a proposed 10-cent gas tax hike to the Nov. 6 ballot for voters to consider. Legislative researchers project it could raise as much as $293 million by fiscal year 2027, which would go toward maintenance and repair of roads and bridges as well as the Highway Patrol.


Republicans in power also succeeded to push through several labor-related proposals, despite some pushback from Democrats.


Lawmakers on Thursday voted to change the date of a public vote on a right-to-work law banning mandatory union dues. The Legislature passed right to work last year, but it never took effect because union supporters collected enough signatures to block it until a statewide vote.


It had been slated for the Nov. 6 general election, but now it will go before voters during the Aug. 7 primary. The date change will shift an expected heavy union turnout away from Democratic U.S. Sen. Claire McCaskill's re-election bid.


Lawmakers also passed a bill to further regulate public unions, including a proposed requirement that they hold recertification elections every three years and get permission annually to withhold dues from workers' paychecks. Another proposal passed by lawmakers would change how some local minimum wages are calculated for public works projects.

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