This Fiscal Note is not an official copy and should not be quoted or cited.
This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0190 - Reduces all individual state income tax rates
COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. NO.: 0450-01
BILL NO.: SB 190
SUBJECT: Revenue Department; Taxation and Revenue - General; Taxation and Revenue - Income
TYPE: Original
DATE: February 26, 1999
FISCAL SUMMARY
|
ESTIMATED NET EFFECT ON STATE FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| General Revenue | ($353,514,259) | ($374,800,000) | ($397,200,000) |
| Total Estimated
Net Effect on All State Funds |
($353,514,259) | ($374,800,000) | ($397,200,000) |
|
ESTIMATED NET EFFECT ON FEDERAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| None | |||
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
|
ESTIMATED NET EFFECT ON LOCAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| Local Government | $0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses
This fiscal note contains 3 pages.
FISCAL ANALYSIS
ASSUMPTION
Officials from the Department of Revenue (DOR) state this proposal would decrease the income tax rate tables by one-half of one percent for tax years beginning January 1,1999.
ADMINISTRATIVE IMPACT:
The proposal would require modifications to the income tax system. The Division of Taxation and Collections estimates the modifications, including programming changes, would require 432 hours of overtime at a cost of $10,404. Modifications to the income tax return and schedules would be completed with existing resources. State Data Center charges would increase due to the additional storage and fields to be captured. Funding in the amount of $2,815 would be requested.
Officials from the Office of Administrative (COA) state the estimate is based on data from Budget and Planning's income tax simulator and the Consensus Revenue Estimate. COA estimates the loss to General Revenue to be $353,500,000 in FY 2000, $374,800,000 in FY 2001, and $397,200,000 in FY 2002.
Oversight estimates a loss to the General Revenue Fund of $88,375,000 for FY 2000 due to the possibility of reduced withholding and estimated income tax payments for five months of calendar year 2000. Oversight assumes 25% of Missouri taxpayers would adjust payments, however it should be noted that this amount could be less depending on taxpayer's awareness of the decrease in income tax rates in determining state income tax and their desire to adjust withholdings or estimated payments.
This proposal would result in a decrease in Total State Revenues.
| FISCAL IMPACT - State Government | FY 2000 | FY 2001 | FY 2002 |
| GENERAL REVENUE FUND | |||
| Loss - General Revenue Fund | |||
| Reduction in income tax rates | ($353,500,000) | ($374,800,000) | ($397,200,000) |
| Loss - Department of Revenue | |||
| Reprogramming costs | ($14,259) | $0 | $0 |
|
ESTIMATED NET EFFECT ON |
|||
| GENERAL REVENUE FUND | ($353,514,259) | ($374,800,000) | ($397,200,000) |
| FISCAL IMPACT - Local Government | FY 2000 | FY 2001 | FY 2002 |
| $0 | $0 | $0 | |
| FISCAL IMPACT - Small Business | |||
| No direct fiscal impact to small businesses would be expected as a result of this proposal. | |||
DESCRIPTION
This proposal would reduce, for all taxable years beginning on or after January 1, 1999, all individual state income tax rates.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Revenue
Office of Administration
Division of Budget and Planning
Jeanne Jarrett, CPA
Director
February 26, 1999