Legislature Overrides Veto of Sen. Kraus’ Senate Bill 1025

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JEFFERSON CITY — The Missouri General Assembly voted today to override the governor’s veto of Senate Bill 1025. Sponsored by Sen. Will Kraus, R-Lee’s Summit, SB 1025 seeks to restore instructional classes given at dance studios, gymnastics facilities and other fitness facilities to the same designation as educational classes for tax purposes.

“The governor’s claim Senate Bill 1025 is trying to ‘chip away at an area of law that has consistently been applied by the Missouri Supreme Court and diligently followed by the Department of Revenue’ is simply false,” Sen. Kraus said. “Prior to the Supreme Court making its interpretation in 2008, the tax on instructional classes was not uniformly collected. Since 2008, the law has not been diligently enforced by the DOR. Even worse is the fact that Missouri businesses who offer these instructional classes have only been made aware of the tax through audits performed by the department, and there are many who still do not know if they should be collecting the tax.

Under current law, the definition of “sale at retail” for purposes of sales tax law includes charges and fees to or in places of recreation. Senate Bill 1025 provides that the definition does not include amounts paid for instructional classes. The act also excludes amounts paid for instructional classes from the 4 percent tax imposed on amounts paid to or in places of recreation.

“Instead of imposing burdensome regulations and overreaching into taxpayers’ pockets, our government should be looking to boost job growth and support the small businesses,” added Sen. Kraus. “I do not believe it was ever the intention of the General Assembly to tax these types of classes, just as we do not tax other educational classes. Senate Bill 1025 will correct this egregious revenue-grab while also promoting our economy and improving our communities.

“As a public servant, I cannot watch bureaucracy regulate our economy into the ground. I sponsored Senate Bill 1025 to prevent the DOR from inflicting further damage on Missouri’s business owners and communities. Plain and simple, today’s veto override is a victory for Missouri businesses and our hardworking taxpayers.”