New year means new laws
Tuesday, December 31, 2013
Wages will rise for Missouri’s low-income workers and taxes will fall for some corporations as a result of laws taking effect with the new year.
While that may be good news for some, it’s not good enough for labor and business groups that want to see even further increases in Missouri’s minimum wage or even deeper reductions in state tax rates.
Some of the new Missouri laws that take effect Wednesday are the result of bills passed during the 2013 legislative session, such as new screening requirements for babies born beginning in 2014 and new benefit entitlements for claims of serious work-related illnesses.
But other changes, such as the minimum wage hike and tax cut, are the result of laws enacted years ago that had annual inflationary provisions or phased-in effective dates.
A law passed by voters in 2006 set Missouri’s minimum wage at $6.50 an hour with an annual cost-of-living adjustment. Because of inflation, Missouri’s minimum wage now stands at $7.35 an hour and will rise in January to $7.50, making Missouri one of 20 states with a rate above the federal minimum wage of $7.25 an hour.
The National Employment Law Project points to research indicating a minimum wage hike can occur without causing job losses.
But Missouri business groups have tried for years to persuade legislators to repeal the inflationary minimum wage adjustment, arguing that it places Missouri employers at a competitive disadvantage with counterparts in other states that abide by a lower, federal minimum wage.
The sponsors of Missouri’s minimum wage initiative, meanwhile, have opposed laws enacted in 2009 and 2011 that first exempted many businesses from Missouri’s corporate franchise tax and then ordered the tax to be phased out.
The middle step in that gradual reduction takes effect in 2014. Legislative staff previously estimated Missouri could collect nearly $20 million less in franchise taxes for 2014, compared to the previous year, because of the phase out.
“It’s another step in the right direction,” said Ray McCarty, president of the Associated Industries of Missouri.
But business groups contend more tax cuts are needed for Missouri to remain competitive with
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