Key Legislation Heard in Committee
Two pieces of legislation I filed for the 2016 session were heard in committee this week. Today I presented Senate Bill 973 to the Senate Veterans’ Affairs and Health Committee. The measure provides that your local pharmacist may dispense your prescription, upon request, more conveniently. For example, if your doctor writes you a prescription for 30 days with multiple refills of your maintenance medication, your pharmacist may use his or her judgment to fill your prescription up to a 90-day quantity. This means your pharmacist would not have to request permission from your doctor, and you would likely have a less expensive copay. It is important to note that SB 973 only applies to maintenance medication and does not change the law regarding narcotics, or Schedule II drugs.
The second measure I presented in committee this week is Senate Bill 906. This bill provides an immediate temporary solution to a problem that could cost Missouri cities and counties millions in lost revenue if no action is taken. The following is some background information on why this legislation is necessary.
From 1949 until 2012, local sales tax was collected on titled vehicles based upon the tax rate in effect at the location where the purchaser resides. Then, in 2012, the Missouri Supreme Court ruled in Street v. Director of Revenue that vehicles purchased out of state were subject to local use tax, but not local sales tax. As a result, there was a huge tax incentive for buyers residing in Missouri cities and counties that had not enacted a local use tax to cross the state line to purchase a vehicle. In response, the Legislature passed Senate Bill 23 the next year. The bill requires any taxing authority without a local use tax to have an election to validate a rate by November 2016. As of now, there are 54 counties and over 1,200 municipalities in Missouri that still do not have a local use tax law in place.
So why is this a problem? Unlike before, dealerships in other states will be prepared to immediately begin marketing their vehicles to Missourians following the expiration of the current statute later this year. Not having to pay local sales tax may sound like a great idea to the average consumer, but we must look at the big picture.
The Missouri Department of Revenue reports that $7.6 billion in auto sales occurred during 2015 in the 54 counties and more than 1,200 cities that will be impacted if the current statute expires. That is $7.6 billion dollars in auto sales that dealerships in neighboring states are currently eyeing and are going to try and win from Missouri businesses come November. From being forced to lay off thousands of employees to even closing their doors, the effects of losing that much money will be devastating to many of our dealerships.
Unfortunately, it won’t just be the dealerships that suffer—entire local economies will be impacted. Based on current estimates, the counties and cities that have not enacted a local use tax law stand to lose more than $44 million in annual revenue if no action is taken. That is money that funds critical local services like police and fire departments. What’s more, these local economies will also lose out on the income that those jobs create if their dealerships are forced to lay off employees or shutter their doors. The bottom line is these taxes were approved by a vote of the people, and I do not believe it was ever their intention to place their local companies and employers at a disadvantage.
This is not the scenario I want to see play out, and that is why I sponsored SB 906. The measure allows local governments and the DOR to continue operating under the current tax structure for another four years. This bill is not in any way raising taxes; it simply keeps the current tax structure in place, while we find a more long-term solution.
The bill also creates the “Missouri Task Force on Fair, Nondiscriminatory Local Taxation Concerning Motor Vehicles, Trailers, Boats, and Outboard Motors.” The task force shall attempt to address the disparity in taxation after Street v. Director of Revenue, the need for local jurisdictions to receive adequate revenue to continue providing critical services, and the need to not competitively disadvantage Missouri dealers. The task force will be required to submit a report on its findings, including any dissenting opinions, to the governor and General Assembly by Dec. 31, 2018.
If you have any questions or comments about this or any other matter regarding your state government, please feel free to contact me at (573) 751-1503; you are also welcome to e-mail me at jay.wasson@senate.mo.gov.
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