With the end of the session in sight, we are definitely reaching the busy time of year in the legislature. Your Representative has been working hard on a number of issues – including the DOR scandal. Having spent a considerable amount of time on this issue in previous reports, there are other issues that we should discuss this week. Know that I am continuing to work on this issue, and I will provide updates in future reports.
The budget bills we approved the week after our legislative Spring Break have now made their way through the Senate and are headed back to the House. The 13 bills make up a spending plan of nearly $25 billion. That total includes a $66 million increase in funding to our public schools and a $34 million increase in state funding to our colleges and universities. Both are increases I support wholeheartedly. Given the attitude of DOR staff and those in the Nixon Administration, I also fully support the reduction of $41 million from the DOR’s Licensing Division.
The House now has the option to approve the bills as they currently stand, which would send them on to the governor to be signed into law, or send them to conference. In conference, selected members from the Senate and House will meet to hash out the differences we may have with the goal of reaching an agreeable compromise. It is likely that most of the bills will be sent to conference where negotiators from both chambers will have until Friday, May 10 to come to an agreement.
Removing the Department of Revenue from the Concealed Carry Permit Process (HB 859)
The bill we passed this week would take the department entirely out of the process of issuing concealed carry endorsements. Right now, Missourians can take their concealed carry permits to a local license office to obtain a photo ID showing the concealed carry endorsement. If the legislation we passed goes into law, our sheriffs would have sole responsibility for printing ID cards for concealed weapon permit holders.
Our sheriffs already take care of receiving applications, conducting background checks and issuing paper permits for concealed weapon holders. The change we propose would simply authorize them also to print a concealed weapon ID card, which would prevent the Department of Revenue from obtaining, or sharing, the private information of Missourians with a concealed weapon.
The bill we approved also would eliminate the renewal process for concealed weapons permits, which currently require a renewal fee every three years.
Tax Reform – HCS SS SCS SB 26, 11, & 31
The Missouri House took a considerable step toward tax reform and economic rebound this week, perfecting and passing HCS SS SCS SB 26, 11 & 31. This bill reduces income taxes at all levels, not just for the big corporations.
Missouri must have a friendly business climate in order to compete in the global economy, and attract businesses to our state. But this measure goes further and rewards the hard work of individuals and the risks of entrepreneurs. Through SB 26, the House aims to make Missouri not only business-friendly, but family-friendly, entrepreneur-friendly, and job-creator-friendly.
Over a five-year period, this legislation will reduce the individual income tax from the current 6% rate to 5.33% and Missourians with incomes under $20,000 will receive a $2000 income tax deduction. For businesses, the current corporate income tax rate of 6.25% will go down to 5.5% and the businesses first $25,000 of corporate income won’t be taxed at all. The most important cut, however, is the 50% reduction on the business “pass through” income tax. These “pass through” corporations – the sole proprietorships, partnerships, and S-corporations – generate more than half of the business income in the United States. Small businesses are truly what keep this country – and this state – moving.
Missouri will make up for the revenue difference by phasing in a 0.6% sales and use tax over the next five years. Opponents of tax reform say this will devastate the poorest Missourians, but this is false. Necessities like food, gasoline, and mortgages will not see any sales tax increase. Meanwhile, individuals who have the means to purchase more, will make their contribution through an increased sales tax.
To ensure Missouri does not have a revenue deficit crisis, the bill has a built-in stopping device. Each phase of the individual and corporate income tax cut is dependent on a revenue increase of at least $100 million from the previous fiscal year. Simply put, if the tax cut doesn’t work as expected, it will not advance. Overhauling our tax structure will undoubtedly mean some changes, but these will be rewarding changes. A cap on revenue will force future legislators to be true stewards of Missourians’ tax dollars, instead of jumping to create a new government program every time a problem arises. New programs often start with good intentions, but more often than not, half the money allocated to programs for the less-fortunate goes to administrative costs. In other situations the programs produce little benefit with less than promised results.
That is what SB 26 does for our state. It enables entrepreneurs to fulfill their dreams of starting a local business. It attracts corporations to relocate to Missouri, bringing with them hundreds of positions for good, family-sustaining jobs. And it gives Missourians a break, allowing them to keep more money and spend it as they like, on goods and services in their local economies, and giving their own neighbors a helping hand. We in the legislature are working to remove barriers for smart, dedicated individuals to set up their own shops and furthermore, we need to encourage families to reinvest in the local economy by allowing them to keep more of their money. I firmly believe that you know how to spend your money better than the government does.
SB 26 now returns to the Senate for final legislative approval before heading to the Governor’s desk. This measure is something both the House and Senate believe in. No matter the Governor’s action, your Republican-led House will continue to pass similar legislation to help our state rebound, and to leave more of your hard earned dollars in your pocket.
As always, please do not hesitate to call or write me anytime with your questions or thoughts on this or any other issue. My Capitol office is 573.751.1490 and my email is Robert.Ross@house.mo.gov. Thank you for the honor to serve as your Representative in the Missouri House of Representatives.