The Joplin Globe, Joplin, MO

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April 11, 2014

Tax cut gains momentum in Jefferson City

JEFFERSON CITY, Mo. — After failing last fall to override Democratic Gov. Jay Nixon’s veto of a $1.2 billion tax cut, Missouri Republicans vowed to come back at the issue this spring.

That effort had been stalled in the Missouri Senate until earlier this month, when, by a 23-9 party-line vote, the body sent a pared back $620 million tax cut bill to the House. That bill, sponsored by state Sen. Will Kraus, R-Kansas City, would reduce the maximum tax rate on personal income by from 6 to 5.5 percent beginning in 2017 and also allow a 25 percent deduction of business income on personal tax returns. Both provisions would be contingent on state revenues being $150 million higher than the highest of the three prior years.

Other provisions would require the state's income tax brackets to be adjusted annually for inflation, resulting in lower revenue, and provide an additional $500 tax deduction on top of the state's current $2,100 deduction for residents with incomes below $20,000.

State Sen. Ron Richard, R-Joplin, voted in favor of the package. Kraus, speaking before a recent vote, said he believed it was time for the state to move on reducing the income for the first time since the 1930s. It is expected the tax cut would benefit more than 2 million Missouri taxpayers.

“This bill is a people’s tax cut, to send taxpayer dollars back to the people and put more money in the economy,” Kraus said.

The measure is supported by business groups such as Associated Industries of Missouri, whose president, Ray McCarty, said he is disappointed by the fact that the tax cut was smaller than he had hoped and that the bill left out corporations, but he said it was a good start nonetheless.

“We call now on the House to move quickly to send this legislation to Gov. Nixon, so we can enact meaningful business tax reductions,” he said.

The House, which already has passed two other alternative income tax plans, held a hearing on the proposal last week.

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