The hot air from Republican politicians is fanning the anti-tax flames again in an election year in Missouri.
Leading the pack is state Sen. Eric Schmitt of St. Louis County, who’s running for state treasurer. Schmitt and others are backing a bill that essentially could cut tax revenue by $1 billion a year in the Show-Me State, a move that would disproportionately help the wealthy keep a lot more money.
It’s almost as if Schmitt and all the others in this camp have blinders on.
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They can’t see what a dumpster fire the Kansas budget has become in recent years because of large income tax reductions pushed by Gov. Sam Brownback in 2012.
Missouri does not want to come close to copying the Kansas experience. Brownback and the Legislature have borrowed more than $1 billion from road funds to stay afloat, borrowed $1 billion to try to steady the state pension system and passed a now-unconstitutional bill that cut into school funding. Last year, Brownback and the Legislature approved the largest tax increase in state history — featuring a rise in the state sales tax that hits hardest at the poor and middle-income residents.
Missouri already has plenty of its own economic problems, such as low job growth, lagging personal income and a Kansas City area that can’t keep up with many of its peer regions.
Missouri also already is a low-tax state, with the scars of being ranked near the bottom of the country in some of the services it provides to residents.
The state’s gas tax is extremely low, which is one reason road conditions are suffering. Missouri does not have a road slush fund, as Kansas has basically created through a special sales tax, to divert money from if the tax-cut strategy goes awry in the Show-Me State.
And Missouri’s cigarette tax ranks an appalling 51st in the country, when the District of Columbia is included in the state rankings.
Schmitt brings up the canard that the Kansas City area on the Missouri side would be helped with a tax cut.
“It’s naive for us to assume a dry cleaner on the eastern side of State Line Road won’t consider moving to the western side of State Line Road if he can save money every year on taxes,” Schmitt says.
No, what’s really naive is believing Schmitt’s claim that a small tax cut would trump workforce quality, rent, customer loyalty and all the other important elements of where a business would locate.
Plus, there’s no evidence to back up Schmitt’s contention on the employment front.
In the last year, the Kansas side of the state line in the Kansas City area gained exactly zero jobs — even in the third year of the Brownback tax cuts.
The Missouri side didn’t do a whole heck of a lot better, but at least it eked out slightly more than 2,000 new jobs from December 2014 to December 2015.
Critics rightly point out that expanded tax reductions in Missouri could threaten funding for K-12 schools, as well as for institutions of higher learning, which already are in hot water with the General Assembly because of turmoil in the MU system.
Missouri has no compelling reason to listen to Republicans and follow Kansas into budgetary abyss.