Missouri could eliminate its income tax and raise sales taxes. What to know
The Missouri House passed a proposed constitutional amendment 95-59 that would grant lawmakers broad authority to raise sales taxes and tax services with the goal of eliminating the state income tax. Voters will now decide whether to approve the changes.
The Missouri House passed a proposed constitutional amendment 95-59 that would grant lawmakers broad authority to raise sales taxes and tax services with the goal of eliminating the state income tax. Voters will now decide whether to approve the changes.
FULL STORY: Missouri voters to decide to eliminate income tax, raise sales and use taxes
Here are key takeaways:
• What the amendment does: It gives lawmakers authority over the next five years to increase sales taxes and implement taxes on services to reduce and eventually repeal Missouri’s income tax.
• What’s at stake financially: About two-thirds of Missouri’s general revenue comes from income taxes — nearly $8.7 billion. Replacing that would require substantial expansion of taxed services or increases to the base sales tax rate.
• Who benefits and who pays more: A Missouri Budget Project analysis found the proposal would lead to a tax increase for 60-80% of Missourians. The wealthiest 20%, earning above $300,000 per year, would see a tax decrease, while a middle-income earner making $65,000 would pay more. But a clearer view of who would pay more won’t be known until lawmakers decide how to increase state revenues.
• Early polling is unfavorable: Torchlight Strategies polling suggests only 37.3% of likely voters would support the amendment, while 49.1% are against it.
• When voters decide: The amendment goes to voters on Nov. 3 unless Gov. Mike Kehoe moves it to the Aug. 4 primary.
• The debate: Supporters say eliminating income taxes will attract businesses and stop population loss. Opponents argue the shift will burden low and middle-income residents who spend more of their money on goods.
The summary points above were compiled with the help of AI tools and edited by journalists. The full story in the link at top was reported, written and edited entirely by journalists.