By The Associated Press
The Missouri Legislature was considering Wednesday whether to override Gov. Jay Nixon's veto of a bill reducing state income taxes. Here are some key details of the measure.
INDIVIDUAL TAXES
- Missouri's current top individual income tax rate of 6 percent, which applies to all income over $9,000, would be reduced by one-twentieth of a percentage point annually for 10 years and then set at 5.5 percent on all income over $8,000.
- Each incremental tax cut would take effect only if annual state revenues rise by at least $100 million over the highest revenue point of the previous three years.
- If Congress passes federal legislation enhancing states' ability to collect taxes on online retail sales, Missouri's top individual income tax rate would be reduced by an additional one-half of a percent.
- Beginning in 2014, the current personal deduction of $2,100 per individual on state income taxes would be increased to $3,100 for those with adjusted gross incomes below $20,000.
BUSINESS TAXES
- Missouri's current corporate income tax of 6.25 percent would be reduced by three-tenths of a percentage point annually for 10 years until it reaches a rate of 3.25 percent.
- Each incremental corporate income tax cut would take effect only if annual state revenues rise by at least $100 million over the highest revenue point of the previous three years.
- Beginning in 2014, 10 percent of the business income reported on individual tax returns could be deducted. That deduction would increase 10 percentage points annually until it reaches a 50 percent deduction in 2018.
SALES TAXES
- The measure requires Missouri to join a "streamlined sales tax" compact with other states to collect voluntary tax payments from online retailers that sell products to people in Missouri.
- The bill also tightens existing requirements for when out-of-state businesses or online retailers may have to pay taxes on sales to people in Missouri.
- Imposes state sales taxes on school textbooks and prescription drugs, the latter as a result of a bill-drafting error.
TAX AMNESTY
- Taxpayers with overdue bills as of 2012 can receive a waiver on penalties and interest if they pay their full tab between Aug. 1 and Oct. 31. The amnesty would be rescinded of they violate state tax laws at any point during the next eight years.