The Truth about Tax Relief for Missouri Families and Businesses
In an attempt to hide the fact that he opposes much-needed tax relief for Missouri families and businesses, Governor Nixon has once again embarked on a smoke and mirrors campaign designed to fabricate non-existent flaws in the tax cut bill approved by the Missouri General Assembly.
The governor has been disingenuous with the people of Missouri as he has claimed the bill would eliminate the top income tax bracket and cut taxes by $4.8 billion annually.
The truth is that SB 509 represents a well-reasoned, responsible approach to tax relief for ALL Missourians.
The Facts on SB 509
SB 509 will responsibly cut the tax burden on Missouri families and businesses by $620 million annually while also safeguarding funding to vital state services such as education.
• Individual Income Taxes:
• SB 509 reduces individual income taxes by one half percent over a period of five years beginning in 2017
• Small business income tax deduction:
• Beginning in 2017 small businesses will be allowed to deduct a maximum of 25 percent of business income over a period of no less than 5 years
• This tax cut is specifically structured to ease the tax burden for small businesses
• Small businesses make up more than 90 percent of our employers in the state, and this tax cut is specifically tailored to allow those employers to thrive and grow
• Tax cut for low-income Missourians:
• SB 509 will increases the personal income tax exemption amount by $500 for those whose adjusted gross income is less than $20,000
• The tax benefits of SB 509 are triggered when the highest net GR collected in the previous three fiscal years is exceeded by at least $150 million.
• Beginning in 2017, SB 509 also requires brackets of Missouri taxable income to be adjusted for inflation.
Safeguarding Education Funding
While the governor has attempted to paint SB 509 as a threat to education funding, his deceptions are exposed when the actual content of the bill is fairly and accurately analyzed.
Because SB 509 requires revenues to increase by at least $150 million each year, revenues would have to increase by $750 million in order for the $620 million tax cut to be fully implemented.
The net result is that state revenues would increase by at least $130 million, which would mean more money for education.
The truth is that SB 509 would invest in Missouri families and businesses by allowing them to keep more of their hard-earned wages: a move that will grow the tax base and increase general revenue.
To see a detailed analysis of how SB 509 would actually lead to more funding for education, click here.
Exposing the Governor’s Lies on the Impact of SB 509
The governor’s claim that SB 509 would eliminate the top income tax bracket is blatantly false. The governor’s contention that SB 509 eliminates the top tax bracket is a desperate attempt to scare Missourians.
In direct refutation to the governor’s claims, former Missouri Supreme Court Chief Justice William Ray Price, Jr. has stated that, “Based upon the plain language of full Senate Bill 509, it is my opinion Missouri courts would find that, after full implementation of the reduction, the 5.5% tax rate would apply to all income over $8,000 (as adjusted for C.P.I.).”
To read Price’s complete opinion, click here.
The Undeniable Benefits of Broad-Based Tax Relief
While revenues continue to considerably increase, the state’s GDP (Gross Domestic Product) remains stagnant. – Missouri is ranked 37th in the nation for GDP growth per capita.
Missouri is not growing at a fast enough pace. Eighteen states have cut taxes in one form or another in 2013 (source: Tax Foundation).
Missourians believe returning surplus money to taxpayers to grow the size of the economy, rather than using a surplus to grow the size of the economy, is a good idea.
SB 509 is a pro-jobs bill that incentivizes growth and puts money back into the tax payers’ hands so they can decide how to spend it.
The personal income tax cut portion of this bill is a reasonable and sustainable approach to make Missouri more competitive with its neighbors.
Providing tax relief to small businesses in Missouri will make us one of the most competitive states, regionally and nationwide.