In the midst of the news surrounding Gov. Eric Greitens, the Senate is moving forward with their work considering two major tax bills: SB 611 and SB 617.
Among other provisions, SB 611 would:
- Reduce the top individual income tax rate by 1.2 percent
- Reduce the corporate income tax rate to 4.25 percent from 6.25 percent
- Eliminate the state income tax deduction for a corporation’s federal income tax liability
- Establish the Missouri Earned Income Tax Credit, 20 percent of a taxpayer’s federal earned income tax credit
- Increase the gas tax from 17 cents per gallon to 18 cents per gallon in 2019 and again to 21 cents per gallon in 2020
- Cap the combined local sales tax rates at 7.275 percent
- Streamline the sales and use tax agreement
SB 617, among other things, would:
- Eliminate the top two and bottom four income tax brackets, leaving a top rate of 4.8 percent for all income over $7,000 and a bottom rate of 3.5 percent for all income below $5,000
- Reduce each income bracket by 0.1 percent every year that net general revenue collections equal or exceed those from the previous year
- Decouple the state standard income tax deduction from the federal standard deduction, setting the amount at 2016 levels, and repeal the Missouri income tax deduction for taxpayers’ federal income tax liability
- Increase the gas tax from 17 cents per gallon to 23 cents per gallon
- Cap the aggregate amount of tax credits that may be authorized in a fiscal year at $425 million
- Streamline the sales and use tax agreement
At this writing, both bills have received a hearing in the Senate Ways and Means Committee.
