A Taxing Week Ahead of Recess
For myself, the past week felt like “win-some, lose-some” in the Missouri Senate. I was in the minority voting against a measure that would raise the cost of gasoline at the pump, but was happy to see a version of legislation I sponsored to level the playing field for Missouri merchants advance onto the House of Representatives. I also was pleased when education reforms I proposed passed out of the Senate. These bills were among a large number of bills that received Senate approval before the General Assembly begins a one-week mid-term recess next week.
The measure I opposed, Senate Bill 262, would result in a 70% increase in Missouri’s gas tax when fully implemented. The proponents of the bill say Missouri’s 17.4 cents per gallon gas tax no longer adequately funds Missouri’s roads and bridges. Their solution is to increase the fuels tax by 2.5 cents per gallon every year until 2025, eventually reaching 29.5 cents. I voted against this legislation, believing Missouri has sufficient resources already to address transportation needs. I believe this is especially true now, with state revenues at record levels and billions of dollars coming in from federal programs. With so many Missourians still reeling from the pandemic, I do not think we should raise gas taxes.
My preference would be to look for savings in current programs rather than ask Missourians to pay more in taxes. I believe the most likely potential area of cost savings is Missouri’s Medicaid budget. A 2019 study from McKinsey and Co. identified as much as $1 billion in possible savings from the program. It’s always easier for elected officials to fix problems by raising taxes, but you elected me to do the hard work, not just take the easy way out. The hard work in this case is to live within our means, not raise taxes, and prioritize record-breaking revenues to take care of our roads, bridges and infrastructure.
If there’s good news, I believe it’s that the gas tax bill – which still must pass the House – contains a provision that allows motorists to apply for a refund of the additional gas taxes they pay. As a tax accountant, I know that many people don’t take advantage of all the breaks they’re allowed, especially when it requires keeping receipts and filling out paperwork. So, while the bill allows people to avoid the increased tax, I suspect most people will simply end up paying the higher tax if the bill passes.
Also this week, the Senate debated a measure that would eliminate personal property taxes entirely. I’m confident this bold proposal would be supported by many Missourians, but Senate Bill 24 has not yet swayed a majority in the upper chamber. I don’t believe we’re done discussing this idea, so it may come up again once we return from recess.
Legislation similar to a bill I proposed did receive Senate approval this week. Senate Bill 153 requires online merchants to collect Missouri sales tax on purchases made in our state. Like my Senate Bill 97, this so-called “Wayfair Bill” addresses the persistent unfair advantage internet-based sellers have enjoyed over local brick-and-mortar businesses. Far too often, customers visit Main Street businesses to shop, but then place their orders online to avoid paying sales tax. This legislation allows local businesses to compete on the same level as online merchants. Missouri is currently one of only two states that has not begun to tax internet sales since the U.S. Supreme Court ruled against online merchant Wayfair in 2018.
Under this legislation, customers will pay the same sales tax regardless of whether they buy goods online or at a store in town. That’s the fair and equitable approach, and it ends a state-sponsored subsidy for people who spend their money out of state. My original legislation, SB 97, had a revenue offset provision that reduced the sales tax rate for in-person purchases. The version that passed the Senate this week doesn’t include that provision, but it does reduce the state’s income tax rate if overall general revenue growth hits a certain amount.
When my colleagues in the House of Representatives return from spring recess, they’ll have before them my Senate Bill 152, which the Senate approved this week. This legislation reforms Missouri’s education savings program to mirror the rules and guidelines of federal 529 plans. I sponsored this measure at the request of the state treasurer’s office, and I’m glad to see it move closer to the governor’s desk. Also included in SB 152 is a provision requiring school districts and charter schools to develop specialized education programs whenever 3% or more of their students are determined to be gifted. I’ve long believed we need to educate all our children, regardless of where they fall on the spectrum – whether they have special needs or are gifted and would benefit from more challenging programs, and everywhere in between.
I was pleased to welcome a number of visitors to the State Capitol this week. Among those who stopped by the 21st Senatorial District office were staff members from Recovery Lighthouse, who came to Jefferson City to advocate for mental health programs. I also enjoyed visiting with members of the Missouri Cattleman’s Association who were in town for that organization’s leadership conference.
As always, I appreciate hearing your comments, opinions and concerns. Please feel free to contact me in Jefferson City at (573) 751-4302. You may also email me at email@example.com.