AIM objectives still alive as end of session looms
The last minute rush is on at the State Capitol, and the picture of what will and won’t pass is still unclear for the most part.
Lawmakers this week passed the state’s $25 billion operating budget for the upcoming fiscal year that begins on July 1. The budget includes a $66 million increase for K-12 schools and a $25 million hike in funding for colleges and universities. The budget also includes funding for custom job training money. The funding is less than AIM supported at the beginning of the legislative session, but is $4 million more than Senate budget makers had allotted for the program.
Also on its way to the governor’s desk is a broad-based tax cut (HB 253) that is aimed at all businesses in Missouri and includes an income tax cut for individuals. Under the bill, S corporations, sole proprietors, partnerships, LLP’s, LLC’s and other flow through entities would enjoy AIM’s originally suggested 50 percent reduction over five years. And it is possible that all businesses could see a nearly 50 percent tax cut, but under language adopted in the Senate, the earliest that could occur is over ten years. The same stands true for personal income taxes, which would be cut by one half of a percent over a period of at least ten years.
“While the tax cut calculation is cumbersome and complicated, we are happy that the business income tax deduction was preserved as we originally drafted it and that some tax relief may be passed by the General Assembly this session,” said Associated Industries of Missouri president Ray McCarty.
In addition, the bill includes the Streamlined Sales Tax Project changes, nexus changes, an amnesty program, and a change in withholding filing frequency that would allow those with less than $100 in withheld tax per quarter to file on an annual basis.
The bill moved out of the Senate on a 24-9 vote on Wednesday evening. The governor has not yet indicated whether or not he would sign the bill.
Also still up for consideration is Senate Bill 1, which includes a fix for the Second Injury Fund and clarifies occupational diseases are covered under an employers’ workers compensation insurance. AIM and many other business groups are opposed to an idea that is circulating around the Capitol that would socialize the costs of toxic exposure diseases through a new surcharge on ALL Missouri employers. Despite support for this idea from a single business organization, Associated Industries and many other employer representative organizations are strongly opposed to increasing costs for employers that will receive no benefit from this ill-conceived plan.
Senate Bill1 has passed both houses of the legislature, and is now supposed to be taken up by a House – Senate conference committee. But that committee has not met yet.
Complicating the situation is House Bill 404, which was debated by the state Senate late Thursday afternoon. That bill also includes language on a toxic exposure fund that would be funded through a surcharge on all Missouri employers.
For those of you who think that there is not much left for the legislature to do, think again. The last week of legislative sessions is notorious for last minute deals, some good, some bad. Stay tuned, the fun has just begun and we at AIM will be on top of the action all the way to the end of the legislative session at 6 pm, Friday May 17.