Endorsement: The Star Editorial Board recommendation on Missouri Amendment 5 | Opinion
On Aug. 4, Missouri voters will be asked to consider Amendment 5, a constitutional proposal to replace the state income tax with expanded sales and use taxes.
Commonly referred to by opponents as the “Everything Tax,” this amendment would gradually eliminate the state income tax, which currently generates roughly 65% of Missouri’s general revenue — between about $8 billion and $9 billion annually. If passed, the financial impact would fall heaviest on low- and middle-income Missourians, as well as rural residents already struggling to make ends meet.
Because of this, we strongly recommend a no vote on Amendment 5.
The measure was Republican Gov. Mike Kehoe’s top priority last legislative session. If approved, it would hand lawmakers broad authority to raise sales taxes and decide which industries are subject to taxation. Supporters argue the amendment would modernize an outdated tax code, promote economic growth and keep more money in residents’ pockets, modeling the policy after Tennessee. However, unlike Tennessee, Florida or Texas — other states with no income tax — Missouri lacks a comparable revenue engine such as significant tourism or oil and gas production to replace lost income tax dollars.
Campaign coalitions both for and against the measure are actively working to sway public opinion, with millions already spent on advertisements.
The pro-amendment Missouri Promise PAC received $9.6 million from six organizations. In contrast, the main opposing group, Missourians for Fair Taxation, is largely funded by a $1.9 million contribution from the Missouri Association of Realtors PAC. Another opponent, the Missouri Budget Project, warns that shifting to a higher sales tax would disproportionately burden working families while threatening funding for education and core state services.
Financial contributions aside, the proposal is risky for Missourians. For the first time, everyday essentials and services could be taxed, including doctor visits, prescriptions, haircuts, rent, daycare and home repairs. People with high incomes typically spend a drastically smaller percentage of their overall financial worth for everyday purchases than lower earners, who already often have trouble making ends meet. Additional sales taxes would be ruinous for many everyday Missourians.
Opponents also note that small Missouri businesses would be forced to charge higher taxes, hurting those located near border states with lower rates. For example, a Raytown car dealer would be forced to raise its overall prices far higher than what is charged for the same vehicle just a few miles away in Overland Park. Furthermore, the official ballot language states the proposal would have an unknown impact on state and local tax revenue — a point that should be a non-starter for voters.
Some of the critics’ contentions are backed by ballot language that reads:
Shall the Missouri Constitution be amended to: Curtail constitutional limits on taxing goods and services.
Ultimately, a yes vote on Amendment 5 would give lawmakers too much authority to increase sales taxes and tax essential services. A no vote would keep the state’s current tax structure intact.
We strongly encourage voters to reject this proposal and vote no on Amendment 5.