House passes tax bracket adjustment legislation

For the first time in since the 1930’s, Missouri’s income tax brackets would be adjusted under legislation given approval by the Missouri House Thursday.

By a vote of 146-4, the House third read and passed HB 1268, sponsored by Rep. Paul Curtman (R-Pacific). Under the bill,  tax brackets would be adjusted for inflation beginning in the 2015 tax year. Currently, the top tax bracket is six percent and it applies to all incomes above $9,000 a year.

While presenting his bill on the House floor Monday, Curtman said $9,000 was a decent living during the early 1930’s, it now falls well below the poverty line.

“This is a bill that’s been a long time coming,” said Curtman. “Since 1931 to be exact.”

Associated Industries of Missouri supports the legislation.

“It would have been great if it had been in place since the 1930’s since the top income tax bracket today would start around $130,000 instead of $9,000,” said McCarty. “But the bill would set us on a path to at least keep up with inflation from this point forward.”

The bill garnered widespread, bi-partisan support in the House. It now heads for the State Senate.

McCarty says the bill will need to be modified once it reaches the Senate to clarify only the brackets of income are indexed for inflation and not the amounts of tax.