Mo. House Approves Tax Breaks For Businesses
The corporate income tax cut is sponsored by Rep. Andrew Koenig, a Republican from St. Louis County who voted against the tax breaks for data centers and startup companies. Koenig described the targeted tax breaks as "manipulating markets and picking winners and losers" but said a general reduction in the corporate tax rate is "equal across the board."
Missouri has about 40,000 corporate income taxpayers, according to figures from the state Department of Revenue.
Yet many small business owners may not benefit from a corporate tax reduction, because their business income is reported on their individual income tax returns, said Brad Jones, the Missouri director of the National Federation of Independent Business.
Earlier this month, the Missouri Senate passed a sweeping measure that would gradually cut individual and corporate income taxes, raise the state sales tax and make various other tax changes. Different groups have projected that the Senate bill could reduce state revenues by between $477 million and $960 million annually once fully phased in.Last month, the Senate also passed an overhaul of the state's tax credit programs that would redirect money from developers of low-income housing and historic buildings to businesses focused on high-tech jobs and international trade. That measure was projected to save the state tens of millions of dollars annually. Like the Senate legislation, Koenig's bill seeks to increase Missouri tax collections from online sales and out-of-state retailers that deliver products to Missouri homes. Koenig's bill would create a new state income tax deduction of up to $10,000 for people who purchase newly built homes between Aug. 28, 2013, and the end of 2015. That could reduce Missouri revenues by between $20 million and $60 million, according to projections by state budget officials. An amendment added Wednesday to Koenig's bill by Rep. Paul Curtman, R-Pacific, also could eventually reduce individual income taxes for many Missouri residents by requiring the state's tax brackets to be adjusted annually for inflation. The result is that it people could eventually earn more income before being charged the maximum tax rate.
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