JEFFERSON CITY—Senator Eric Schmitt, R-Glendale, today (12-1) prefiled legislation that would reduce the tax burden on individuals and small businesses in the Show-Me State, allowing that income to be reinvested in Missouri’s economy through consumer spending and business expansion and growth.
Senator Schmitt’s legislation would reduce the individual income tax rate by lowering the top rate to 5 percent. Additionally, the legislation would also create a larger business income deduction. Taxpayers would be able to deduct 50 percent of their business income once fully phased-in. Both provisions would be phased-in over a period of years, beginning in 2017.
However, the bill also contains safeguards that prevent the cuts from taking effect unless general revenue has increased enough to allow for adequate funding of the Senate’s top legislative priorities, such as education. If revenue does not increase, the reductions do not go into effect for that year.
“The passage of last year’s tax cut was a solid step forward for our state in terms of creating a climate that is conducive to job creation,” said Sen. Schmitt. “However, Missouri continues to see sluggish growth, year after year. Meanwhile, our neighboring states are taking proactive steps to encourage economic expansion and reaping the rewards. We need to continue reforming our tax code so that individuals keep more of their hard-earned money, and small businesses, the backbone of our economy, can continue to grow.”
The bill is similar to last year’s broad based tax relief measure, whose passage was spearheaded by Sen. Schmitt, chairman of the Senate Jobs, Economic Development and Local Government Committee. That legislation reduced the individual income tax by 0.5 percent and created a 25 percent deduction for business income, among other provisions.
“Our state needs a new path. The same old policies have failed to yield any substantial gains. We need to embrace new, innovative ideas,” said Sen. Schmitt. “This bill increases families’ take-home pay, and drastically lessens the burden on small businesses. It has the potential to herald in a new era of economic growth and prosperity for our state, without affecting our ability to fund the state’s primary obligations.”
To read more about Sen. Schmitt’s legislative efforts to encourage job creation and growth in Missouri, visit his official Senate website at www.senate.mo.gov/schmitt. |
