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Sun, Nov 22 2009 

Missouri: Tax hike raising ire in Kansas

Senate President Pro Tem Micheal Gibbons, a Republican from suburban St. Louis, sounded equally defiant.

“In Missouri, we’re willing to stand on our own feet,” Gibbons said, “but we don’t need to stand up for someone else — for some other government.”

Lost in vitriol is the fact that Missouri’s nonresident tax increase is unlikely to directly effect the pocketbooks of individual Kansans. Because of the way tax codes work, Kansans who pay more Missouri income taxes should see comparable reductions in their Kansas income taxes. The same holds true in almost any state.

“It’s a wash for the taxpayer,” Wagnon said, “but basically it transfers money from Kansas (government) into Missouri.”

Missouri estimates it stands to gain $11 million annually in income taxes, primarily coming residents of its neighboring state. Kansas estimates a loss of $5 million next year because of the change in Missouri’s tax law.

What some Kansans may not realize is that some Missourians along the Illinois border have been subjected to a similar tax situation. Thousands of Illinois residents who work in St. Louis or other Missouri border towns have been allowed for years to deduct their property taxes from Missouri’s income tax — even though Missourians who work in Illinois are not allowed to do the same.

Some St. Louis area senators had tried for years to pass legislation bridging the Mississippi River with greater parity on property tax deductions. They finally succeeded this year.

But Missouri may have started a chain reaction that goes beyond Kansas.

Tax officials in other neighboring states such as Arkansas and Oklahoma were unaware of Missouri’s tax law change until contacted by The Associated Press.

“Very interesting,” observed Clarence Collins, manager of Arkansas’ individual income tax section. “It’s kind of penalizing” residents of other states, he said.

Missouri’s governor, at least, is trying to appease his neighbors, particularly in Kansas.

“I don’t think it’s beneficial for our Legislature to engage in some warfare with the other eight states that touch Missouri and compare and contrast the tax codes,” said Blunt, who assured: “We’re not going to re-enact the Quantrill raids, certainly.”



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