Broad-Based Tax Relief Act Headed to Governor's Desk (HB 253)

This week we approved a piece of legislation that would cut Missouri’s income tax
rate for the first time in more than 90 years. It’s a move that would allow
Missouri families and businesses to keep more of their income each year.

The bill would reduce the state's top individual income tax rate of 6 percent to 5.5 percent over a period of 10 years. Over the same period of time it also would reduce the corporate income tax rate of 6.25 percent to 3.25 percent. The bill also creates a five-year phase in of a 50 percent deduction for business income, and increases the existing $2,100 personal deduction by $1,000 for individuals who earn less than $20,000.

When the cuts are fully phased in, they would produce a tax savings for Missourians of approximately $700 million annually. To ensure the revenue lost because of the cuts doesn’t jeopardize important funding in the budget, the legislation also contains safeguards to ensure our revenues continue to increase even as the cuts are being phased in.

The tax cuts in the bill would only go into effect each year if revenues grow
by at least $100 million over the state's highest general revenue point in the
previous three years.

In addition, the bill contains provisions that would generate additional revenues for the state. One provision would create a tax amnesty period for overdue taxpayers. Another would increase tax collections from online sales. Both changes will generate tens of millions in additional revenues.

I’m excited that we have moved this bill across the finish line and now stand on the verge of providing a tax cut to all working Missourians. Our hope is that the governor will sign this important piece of legislation into law so that families and businesses will be able to keep more of their hard-earned dollars in their pockets rather than in government coffers.