Associated Industries of Missouri applauds House on passage of HB 253
Calling his bill a “measured response” to business tax cuts across the state line in Kansas, State Rep. T.J. Berry (R-Clay County) successfully guided AIM’s Broad-Based Tax Relief Act of 2013 to overwhelming passage in the Missouri House Thursday.
House Bill 253 represents a new approach to cutting taxes on businesses in the state. The bill, suggested by Associated Industries, would cut the income taxes of every Missouri business in half over five years.
Rep. T.J. Berry (Photo courtesy Tim Bommel, Mo. House of Reps.)
The first cut of 10% would be effective for the 2013 tax year because net income tax revenues for fiscal year 2012 were greater than fiscal year 2011. For each of the next four tax years in which the net income tax revenues are greater than in fiscal year 2011, income taxes for all businesses would be reduced by an additional 10% until the total reduction of 50% has been achieved.
For companies that pay their employees at least 150% of their county’s average wage, income taxes would be cut in half immediately, beginning in tax year 2013.
“This is a measured response when it comes to a lot of the legislation we have seen on taxes,” said Berry during debate on the House floor. “We cut ten percent, then we stop. If general revenue increases, then we take another ten percent and repeat the same process all the way down to a 50 percent reduction to all people in business.”
In addition to the income tax cut, House Bill 253 was amended to clarify sales tax rules on places of amusement. In recent years, the Missouri Department of Revenue has held some gyms to be taxable and some to be exempt and there has been much confusion over what constitutes a “place of amusement” under the current law.
An amendment to allow many withholding tax filers to file on an annual basis was also added to the bill, to allow employers with less than $100 in withholding tax in each of the previous four quarters to file on an annual basis.
Also, an amendment to add titled manufacturing and mining equipment to the new and expanded plant manufacturing and mining exemption was adopted.
“This is an offensive and a defensive play against Kansas,” said Berry. “We want to keep what we have, but hopefully there is enough to incentivize businesses to come to Missouri.”
The bill received final passage in the House by a 106-48 margin. It now moves on to the State Senate.
“This is a big step forward for Missouri business,” said Associated Industries of Missouri president Ray McCarty. “This bill allows Missouri businesses to keep more of their hard earned money to increase employment, increase employees’ pay, and invest in infrastructure.”