A proposal to cut Missouri’s income tax and raise its sales tax was heard Tuesday by a House committee. The bill’s backers are focusing their attention on Kansas, where lawmakers last year made deep cuts to income tax rates.
GOP Senator Will Kraus of Lee’s Summit, the bill’s sponsor, says Kansas is specifically targeting businesses in Missouri with a tax-friendlier environment.
“As leases come up, Missouri businesses are gonna look at the tax advantages and the incentives that Kansas is offering and potentially jump the border, and particularly in my neck of the region, in Kansas City,” Kraus said. “The impact to our state is gonna be the loss of revenue and the loss of jobs.”
Opponents include Lee’s Summit Schools Superintendent David McGehee. He says Missouri is in no financial condition to voluntarily give up revenues.
“Missouri’s funding for public schools is already more than $600 million below what is required to fund its own foundation formula, with no real plan in sight to ever see full funding,” McGehee said.
In addition, a non-profit group that advocates for the poor in Missouri has launched an ad campaign saying the proposal could cost the state nearly a billion dollars.
Senator Kraus called the ads “misleading” and “distasteful,” and says the drop in revenues would only be around $477 million over five years’ time.
The bill has already passed the Missouri Senate and now awaits a House Committee vote.
