Wednesday, Jan. 30 2013 7:16AM
Reforming Missouri’s tax policy
By Will Kraus
As the chairman of the Senate Ways and Means Committee, I am fortunate to be leading the discussion regarding Missouri’s current tax policies and how they might be redesigned to attract more residents and businesses to the state. This week, we heard three bills in the committee, all of which lowered the tax burden on Missouri businesses and residents in some way.
Next week, the Ways and Means Committee will take public testimony on tax policy issues in general. I know there are good ideas out there that were not addressed in the bills heard this week. All ideas will be on the table as we try to come to agreement on one bill which can reach a common goal. In addition to that testimony, we are accepting public comments to email@example.com. Those comments will be shared with the members of the committee.
One of the projects our office undertook during the interim was to study tax policy in Missouri. We also looked at surrounding states, and at states that seem to have higher job growth or economic growth. We found some interesting things. First, Missouri’s reliance on personal income tax was one of the highest in the area, and we have a very low reliance on sales tax as compared to other states. Second, we found that higher growth states often use low or non-existent taxes to attract residents or business, and it works. In analyzing the research, it is easy to conclude that we could have a better mix of taxes to create a healthier business environment in Missouri.
The tax policy discussions in the Senate over the next few weeks will be broad and will cover many areas. We will discuss personal and corporate income taxes; general state sales taxes and the partial tax exemption on food; selective sales taxes, such as taxes for cigarettes, alcohol and gas; various fixes for e-commerce or Internet taxes; and the potential for other changes to the Missouri tax structure. My hope is that the Senate can build a consensus bill around these topics within a short period of time.
While Kansas and other states around us have passed, or are considering, major tax structure changes, Missouri has the opportunity to be a leader in finding the best possible solution. Many people think Kansas may have gone too far in cutting taxes, and we will have to be careful to not do so ourselves. I look forward to the discussion and input from constituents like you.