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HCS/SS/SCS/SBs 3 & 5 - This act modifies provisions relating to taxation. ADOPTION TAX CREDIT Current law authorizes a tax credit for nonrecurring adoption expenses, with such tax credit being nonrefundable. For all tax years beginning on or after January 1, 2023, this act makes such tax credit refundable. (Section 135.333) INCOME TAXES Current law provides for reductions to the top rate of income tax to an eventual rate of 4.8% over a period of years, contingent on meeting certain net general revenue collection triggers. This act repeals all such scheduled reductions and reduces the top rate of income tax to 4.95% beginning in the 2023 calendar year. This act also adds one additional potential 0.15% reduction in the top rate of tax. Such additional reduction shall only be effective if the amount of net general revenue collected in the previous fiscal year exceeds the highest amount of net general revenue collected in any of the three fiscal years prior to such fiscal year by at least $175 million. Finally, this act adds three additional potential 0.1% reductions in the top rate of tax, for an eventual rate of 4.5%. Such additional reductions shall only be effective if the amount of net general revenue collected in the previous fiscal year exceeds the highest amount of net general revenue collected in any of the three fiscal years prior to such fiscal year by at least $200 million, and exceeds the amount of net general revenue collections from the fifth prior fiscal year, adjusted annually for inflation. The amount of net general revenue collected required to reduce the top rate of tax from 4.8% to 4.5% shall be adjusted annually by the percent increase in inflation. (Section 143.011) This provision shall be effective January 1, 2023. Current law exempts the first $100 of a taxpayer's income from taxation. For all tax years beginning on or after January 1, 2023, this act exempts the first $1,000 of income from taxation. (Section 143.021) This provision contains an emergency clause. CORPORATE INCOME TAXES Current law taxes corporate income at a rate of 4%. Beginning with the 2024 calendar year, such rate may be reduced over a period of years. The first two reductions shall each be by 1%, and shall only be effective if the amount of revenue collected from corporate income tax in the previous fiscal year exceeds the highest amount of revenue collected from corporate income tax in any of the three fiscal years prior to such fiscal year by at least $150 million, with such amount adjusted annually for inflation. The remaining eight reductions shall be by 0.25%, and shall only be effective if the amount of revenue collected from corporate income tax in the previous fiscal year exceeds the highest amount of revenue collected from corporate income tax in any of the three fiscal years prior to such fiscal year by at least $50 million, with such amount adjusted annually for inflation. (Section 143.071) FEMININE HYGIENE PRODUCTS AND DIAPERS SALES TAX Beginning January 1, 2023, this act provides that the state sales tax rate on retail sales of feminine hygiene products and diapers, as such terms are defined in the act, shall be levied at the same rate as the state sales tax on food, which is currently one percent. (Section 144.016) JOSH NORBERG
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