Over the past several weeks, the governor has been signing numerous bills and proposals, which were passed by the General Assembly during the 2018 legislative session. Among the signed legislation is House Bill 2540. This bill is an income tax cut, allowing Missouri families to keep more of their hard earned income. This new tax cut will boost Missouri’s economy by lowering our state’s top individual income tax rate, while also reforming the way our state taxes businesses. I believe this legislation presents Missourians with the largest single year tax cut in our state’s history.
Recently, state revenue growth triggered an income tax cut, lowering our state’s top income tax rate from 5.9 percent to 5.8 percent. Starting in 2019, House Bill 2540 will reduce the top individual income tax rate by .4 percent from 5.8 percent to 5.4 percent. Additional triggers in previously passed legislation have the potential to lower the individual income tax rate to 5.1 percent, making Missouri the 14th lowest income tax state in the country.
Tax reform was a major priority for lawmakers during the 2018 legislative session, and I was pleased to see this bill pass during the final week of the legislative session. This is a big step forward in modernizing our tax policy and making Missouri a more competitive state for individuals and businesses.
Senate Bill 573 has also been signed into law. This legislation modifies several provisions of state law relating to tax deductions for National Guard and reserve members. This legislation is a continuation of Senate Bill 814, which was passed and signed into law in 2016. Both of these bills are designed to allow active military personnel and members of the National Guard and the reserve components of the Armed Forces to deduct their military income from their Missouri adjusted gross income for tax purposes.
It is important to recognize the huge impact of the military on Missouri’s economy. Between 2013 and 2015, military spending constituted more than $32 billion per year in goods and services purchased from Missouri companies, resulting in more than 183,000 jobs created in the state. This number has steadily increased over the last several years, and the economic impact of the military on our state is substantial.
Earlier this summer, Senate Bill 793 was also signed into law. This legislation raises the age of adult court jurisdiction to 18 years old in Missouri, except in serious offenses. The vast majority of 17-year-olds arrested are accused of offenses that are non-violent and involve no weapons. Missouri has been considered a leader in juvenile justice, but our state is falling behind when it comes to addressing their rehabilitative needs. This legislation will allow these young people to have access to education and rehabilitation, while being protected from the kinds of assault and abuse that are too common in adult jails and prisons.
As always, I appreciate it when groups from around Missouri and from our community back home come to visit me at the Capitol. If you would like to arrange a time to come and visit me in Jefferson City, or if you ever have any questions, please don’t hesitate to contact my Capitol office at (573) 751-1882.