The Missouri Senate gave initial approval this week to a bi-partisan tax relief bill that could have far-reaching benefits for our state. Senate Bill 26 is the first comprehensive tax relief measure to come out of the General Assembly in some time. It takes a measured approach to tax reform by balancing the possible economic benefits of a tax cut with our state’s fiscal obligations.

Under the bill, the personal income tax rate, starting in the 2014 tax year, is lowered by 0.75 percent over a five-year period, maxing out at 5.25 percent in 2018. The bill also reduces the corporate income tax rate by 0.75 percent over the same period, lowering it to 5.5 percent by 2018. In addition, the legislation creates an individual business income tax deduction starting at 5 percent in 2013; once fully phased in, taxpayers can deduct 50 percent of their business income for all tax years after 2016.

Another important component of the bill is the Streamlined Sales and Use Tax Agreement, which will allow Missouri to collect sales tax on online purchases. Currently, consumers who buy items online pay no sales tax. This has put our local brick and mortar stores at a severe disadvantage. People will often go to a local business to test out a product, and then go home and order it online. The practice is devastating small, local businesses. The Streamlined Sales and Use Tax Agreement will level the playing field.

On Tuesday, the Governmental Accountability and Fiscal Oversight Committee heard Senate Bill 339, which I sponsored. The bill establishes the Missouri Works Training Program and modifies provisions relating to unemployment compensation.

Missouri is currently the only state in the country that still requires individuals seeking unemployment benefits to physically visit a career center every four weeks. It’s an archaic requirement that places a huge burden on people, especially in our area, who often have to drive miles to get to a career center. By eliminating this requirement, unemployed individuals can save money on transportation costs.

It’s a common-sense measure that simply brings our current unemployment system into the 21st century. It will also free up limited resources at our career centers. Instead of being tied up with individuals reporting for unemployment benefits, staff can focus on providing services for job seekers such as one-on-one assistance, interview coaching and National Career Readiness Certificate preparation and testing.

Senate Bill 339 also establishes the Missouri Works Training Program, which combines several existing programs to better provide job training assistance to qualified companies. This streamlines our training programs, making them easier to use, less bureaucratic and more business-friendly. The bill also expands which organizations qualify, adding technology centers created by community colleges and state-owned postsecondary technical colleges. Community colleges support the lion’s share of these programs, so expanding eligibility to include them will allow countless more citizens to take advantage of valuable work training.   

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