HCS HB 643, 710 & 711 -- CORPORATE FRANCHISE TAX

SPONSOR:  Bray

COMMITTEE ACTION:  Voted "do pass" by the Committee on Ways and
Means by a vote of 18 to 0.

Under current law, corporate franchise tax is levied only when
the par value of a corporation's outstanding shares and surplus
of stock exceeds $200,000.  This bill increases the $200,000
minimum base to $1 million.  This provision will become
effective April 1, 1999.

Under current law, the state corporation franchise tax is
collected and administered by the Secretary of State.  This bill
transfers those responsibilities to the Department of Revenue.

These provisions will become effective January 1, 2000.

FISCAL NOTE:  Partial Estimated Net Decrease to General Revenue
Fund of $1,700,000 in FY 2000, $4,700,000 in FY 2001, and
$4,888,000 in FY 2002.

PROPONENTS:  Supporters say that this bill will relieve the
corporate community of an unneeded tax burden.  Certain
witnesses also testified that the corporate franchise tax is a
greater burden on small business.

Testifying for the bill were Representatives Bray and Van
Zandt;  Missouri Retailers Association; Missouri Chamber of
Commerce; National Federation of Independent Businesses;
Associated Industries of Missouri; and Regional Commerce and
Growth Association.

OPPONENTS:  There was no opposition voiced to the committee.

Bill Tucker, Assistant Director of Research

HB 643 -- Corporate Franchise Tax

Sponsor:  Bray

Under current law, corporate franchise tax is levied only when
the par value of a corporation's outstanding shares and surplus
of stock exceeds $200,000.  This bill increases the $200,000
minimum base to $1 million.

This bill will become effective April 1, 1999.