House gives final approval to phased-in tax relief
Keeping up with the tax cutting theme of the day, the Missouri House of Representatives Thursday gave final approval to a bill that would phase in tax cuts for all Missouri taxpayers.
House Bill 1295, sponsored by Rep. Andrew Koenig (R-St. Louis) phases in a .7% cut in the individual tax rate over 7 years of $150 million-plus growth in state revenues over the highest of the previous three years, similar to triggers in last year’s House Bill 253.
The bill also phases in a 50% business income deduction over five years of such growth, and the bill adds an additional personal exemption for taxpayers with less than $20,000 Missouri adjusted gross income.
Under the legislation, there would be no change in the corporation tax rate.
“Associated Industries of Missouri supports the concept of lowering tax burdens for Missouri businesses, particularly smaller entities that don’t qualify for most current tax credit and other incentive programs,” said AIM president Ray McCarty. “But the bill doesn’t include ALL Missouri businesses. This is another tax cutting vehicle in the state legislature, and we look forward to working with Rep. Koenig and key supporters as the bill works its way through the process.”
The bill, as amended on the House floor, would require 40% of the $150 million in growth to be deposited in the School District Trust Fund, and 40% would be appropriated to higher education. Such growth is required before each step of the tax cut.
HB 1295 passed a final vote in the House 106-47…and now moves on to the State Senate.