Archive for Thursday, January 24, 2013

Missouri tax debate focuses on Kansas

January 24, 2013


JEFFERSON CITY, MO. — Envious of big tax cuts in neighboring Kansas, Missouri Republicans outlined ambitious plans Thursday to cut state income taxes in hopes of deterring businesses and residents in western Missouri from moving across the state line.

While business lobbyists praised the proposals, Democrats, budget analysts and a teachers union representative all warned that Missouri may not want to be too much like Kansas, which now is grappling to fill a budget shortfall because of the tax cuts.

Income tax cuts are expected to be one of the marquee issues of Missouri’s 2013 legislative session and also are on the agenda in neighboring Nebraska, Oklahoma and several other states with solid Republican majorities. Their model is Kansas, which effective this month reduced individual income taxes, increased standard deductions and exempted the owners of 191,000 partnerships, sole proprietorships and other businesses from income taxes.

“A response is warranted — not just because somebody else is doing it, because it’s the right thing to do,” state Sen. Eric Schmitt, R-St. Louis County, told colleagues on the Missouri Senate Ways and Means Committee.

State Sen. John Lamping said Missouri needs a comprehensive change to its tax policy that provides employers with more money to invest in their businesses and gives employees more money to spend on their families.

“Tax cuts need to be dramatic, they need to be perceived to be permanent, and then people respond to the change,” said Lamping, R-St. Louis County.

The Senate panel heard testimony Wednesday on three tax-cut proposals.

• Senate Bill 11, by Schmitt, would gradually cut the state’s corporate income tax in half over the next five years. It also would phase in a 50 percent deduction for business expenses on individual income taxes, which is intended to benefit smaller businesses that aren’t structured as corporations. When fully implemented, the bill is projected to cut state tax revenues by $351 million annually.

• Senate Bill 26, by committee chairman Sen. Will Kraus, R-Lee’s Summit, would lower Missouri’s top individual income tax rate to 5 percent instead of the current 6 percent. The legislation also would phase in a 25 percent business income deduction on individual income taxes over the next five years, and would cut the corporate income tax rate nearly in half over the next three years. The bill is projected to cut taxes by $946 million annually when fully phased in.

• Senate Bill 31, by Lamping, would set a standard 4 percent state income tax rate beginning in 2014 — amounting to a tax hike for the poor but a cut for the middle class and wealthy. The bill also would raise the state’s cigarette tax by 23 cents per pack and impose a half-cent sales tax dedicated to rebuilding Interstate 70. The income tax cut would be significantly larger than the tax increases, resulting in a net projected tax cut of $1.1 billion annually.

The committee plans to hear additional public testimony about Missouri’s tax policies next week.

The Kansas tax cuts have contributed to a projected $267 million budget shortfall for the fiscal year beginning in July. Kansas Gov. Sam Brownback, a Republican, has proposed generating state revenues by eliminating income tax deductions for the mortgage interest and property taxes paid by Kansas homeowners. He also wants to cancel the scheduled expiration of a temporary sales tax increase.

But even as Brownback attempts to balance the budget, he is proposing additional income tax cuts for the future, with a goal of eventually eliminating the state’s individual income tax.

During the Missouri Senate hearing, some Democratic lawmakers questioned the wisdom of emulating Kansas.

“If we’re going to look at Kansas, they’re not doing good. They have cut, and they can’t fund their schools now,” said Missouri state Sen. Paul LeVota, who lives in Independence, Mo., but works in Lenexa, Kan.

Jim Moody, a former Missouri budget director who now is a consultant and lobbyist, said Missouri already has reduced its taxes by nearly $1 billion over the past 15 years. He said Brownback’s latest tax-cut plans for Kansas could jeopardize government services.

Moody and Democratic lawmakers suggested Missouri should wait to see the effect of the Kansas tax cuts. But some business lobbyists suggested Missouri must strike quickly to avoid an economic defeat in the long-running battle for businesses between the two states.

“What Kansas did really was a shot through the heart to Missouri,” said Ray McCarty, president of Associated Industries of Missouri.


JackMcKee 5 years, 4 months ago

Might as well be whistling Dixie. Nobody is following Kansas' race to the bottom. Sorry Brownback.

Cant_have_it_both_ways 5 years, 4 months ago

Looks like Missouri does not want that race to the bottom. Lets see, working people move to Kansas and the social leeches move to Missouri. I really don't see how this could be bad.

just_another_bozo_on_this_bus 5 years, 4 months ago

"Looks like Missouri does not want that race to the bottom."

Huh? Republicans there are contemplating jumping into that race at a dead sprint.

Cant_have_it_both_ways 5 years, 4 months ago

You must think I am cute or something Bozo....I have asked you numerous times not to troll me.

Again, I am asking you not to troll me.

just_another_bozo_on_this_bus 5 years, 4 months ago

"I have asked you numerous times not to troll me."

I assume that by "trolling" you mean you don't want me to reply to your posts, and reply is all I did here. Admin has made it pretty clear that that's all they'll allow, despite the generally inflammatory nature of nearly every one of your posts.

But let's put the record straight-- you have never made any request that I not reply to your posts-- at least not under your current persona.

Nevertheless, I'll respect your request.

Richard Heckler 5 years, 4 months ago

Look at it this way. This has been a well financed orchestrated nationwide event since Sam Brownback became governor. Koch Industries and other USA corporations want to kill good wages everywhere. Wisconsin,Michigan,Ohio and others are being manipulated. Now Missouri.

Wall Street bankers,leveraged buyout artists(ROMNEY),medical insurance industry executives, US Chamber of Commerce,USA war profiteers,NRA and the right wing are the largest threat to economic growth in the USA. The are not alone however. So is this nationwide group posing as the GOP.

Unlike many other organizations, ALEC and the Rt Wing Libertarian Neocon Fundamentalist Tea Party for Economic Terrorism membership includes state lawmakers, members of congress and corporate executives who gather behind closed doors to discuss and vote on model legislation. Both organizations operate as and are posing as the new GOP.

In recent months, ALEC has come under increasing scrutiny for its role in drafting bills that will impact workers across the USA.

--- attack workers’ rights and reduce wages.

--- roll back environmental regulations.

--- privatize education and reduce wages.

--- deregulate major industries and reduce wages.

--- passing voter ID laws.

--- encourage high dollar medical insurance.

A recent annual ALEC meeting boasted the largest attendance in five years, with nearly 2,000 guests in attendance. A look at some 800 model bills approved by companies and lawmakers at recent ALEC meetings.

patkindle 5 years, 4 months ago

Missouri has the welcome mat out for all bordering states, but They are aware the number of people in kansas is so few it is not much of an attraction,. On the north with higher taxes is iowa and they cash in rather well On the border states, On the east the most corrupt state with some of the highest taxes is Illinois and the state of Chicago, and they have plenty Of money flowing over the state lines, Sorry but once again, no one really cares about Kansas

headdoctor 5 years, 4 months ago

Looks like Brownback's plans may have just went from SNAFU to FUBAR. At least Missouri funds their schools to try and maintain an educated population and they have some perks Kansas doesn't have.

DrQuack 5 years, 4 months ago

Please: "have gone," not "have went."

Cant_have_it_both_ways 5 years, 4 months ago

If Missouri is so stirred up over this tax thing, it must be good. Everyone should be on board with this especially those who choose not to work and leech off of those who do. You see, more money for the state means more money for those entities and entitlement programs. WOOT!

headdoctor 5 years, 4 months ago

Yes, those wealthy moochers and leeches should stop stealing from the poor and middle class. I am still trying to figure out if some people just stumbled onto a couple of new vocabulary words and like them so well they keep using them in sentences or if they are really just jealous that someone might be getting something they are not.

Brendon Allen 5 years, 4 months ago

Cant_have_it_both_ways: This logic is so flawed. So then Kansas becomes less attractive because Missouri one ups us on attracting business that pays no tax and low wage jobs. So Kansas gives more incentives. Oklahoma doesn't want to be left out so it does even more. And so the cycle continues until the midwest is nothing but another South like Alabama, Mississippi, Louisiana etc who all are one upping each other and cutting education, social welfare, mental health programs, road maintenance, etc etc to pay for it all. In return they get some of the lowest paying jobs in the nation and have laws allowing no collective bargaining to get them anything better. They are the new Mexico. Sound like a familiar path? There is a reason those states rank last in just about everything. So I suppose those dixie flags they sell in Mizzery will come in handy soon.

Cant_have_it_both_ways 5 years, 4 months ago

Could it be that less than half the people actually pay taxes? Are more worried about finishing their tatoo than paying down their debt? Would rather complain on this forum instead of actually getting a job? Yea...the liberal progressive way is really working. Lets try for once the path of personal responsibility. Generate your own way instead of demanding someone else pay your bills just because you are born. So is my logic still flawed because I choose to pay my own way? Is it considered greed when I would like to keep what I earned or is it greed when non producers demand my hard earned cash while they sit in a house paid for by the taxpayer watching their nice new TV paid for with welfare cash... yea... This is a wonderful country we live in. Your position does nothing to fix it.

Brendon Allen 5 years, 4 months ago

When you setup a system where states compete to lure in companies and give them decade long tax abatements and they don't pay decent wages this has nothing to do with personal responsibility. What all those on the far right (I refuse to call myself left I used to be a Reagan republican until my party went off the rails, yes the same one that raised your taxes then) is the ranks of the working poor is FAR FAR larger than any "takers". These are the people that get hurt by this competition along with our ability to educate and stay competitive in a global economy. All this will serve to do is shrink an already shrinking lower-middle and middle class and tax base along with it. Also the far rights view of "takers" involves far more people that paid into the system they are now getting benefits from than those gaming it. Only 2-3% are on what is considered traditional welfare. This exaggeration of the minority of the people that game the system when federal income tax rates are already the lowest since the 1930s and them having their hand in your pocket is frankly laughable. The far right takes one example of someone who games the system and extrapolates it to the whole program they may be on instead of looking for statistical validity. But then again when have the facts ever gotten in the way of someone who already has their mind made up?

Katara 5 years, 4 months ago

Again, repeating a lie does not make it true. The "less than half the people" refers only to Federal Income tax. It does not refer to State Income tax nor to sales tax nor to property tax nor gas taxes or any other type of taxes.

Wow. So many stereotypes in one post. I think you left out the Welfare Queen who purchases lobster, filet Mignon, caviar and toast points with her food stamp money and then hops into her Cadillac Escalade to speed off to her vast estate in the countryside.

Cant_have_it_both_ways 5 years, 4 months ago

If you want to fund these people, then get your check book out. Don't ask me to do it for you.

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