For Immediate Release: January 9, 2017
While State Struggles to Pay Bills, Senate Committee to Consider Proposal that Would Further Drain Investments in Missouri’s Human Capital & Infrastructure
Although our state is already struggling to pay its bills, a Missouri Senate Committee is scheduled to consider a measure that would compromise Missouri’s ability to invest in the building blocks of a strong economy.
“Hardworking Missouri families pay their taxes and expect the state to live up to its end of the bargain,” said Amy Blouin, Executive Director of the Missouri Budget Project, a nonprofit think tank that analyzes budget and tax policy. “That means quality public education, a reliable transportation network, and a host of other tried and true investments in economic growth.”
Corporate tax changes and a package of unbudgeted tax cuts have significantly reduced expected revenue for the year, and Governor Nixon already issued nearly $200 million in budget restrictions. The Missouri Budget Project estimates that an additional $200 to $250 million in service cuts will be required before the end of the fiscal year in June.
“Missouri has already backed out of some of its commitments across the state, including education and health care, and we’re not out of the woods yet,” continued Blouin. “Governor Greitens faces some difficult decisions, as he will likely need to cut an additional $200 to $250 million this spring.”
Despite having a backlog of high priority transportation projects and shorting K-12 education according to the state’s own funding formula, on Tuesday morning the Senate Ways and Means Committee is scheduled to hear Senate Bill 17, a bill that would eliminate the corporate income tax altogether – at a cost of as much as $400 million each year.
“Missouri already has one of the lowest corporate income taxes in the country. If it were so important, businesses would already be pounding down our door,” said Blouin. “The truth is, businesses need a skilled and educated workforce, and customers with spending power. While eliminating the tax will have little effect on job growth, every penny of its cost will have to be made up by cuts to the kinds of investments that really create quality middle class jobs, like education, public safety, and health care.”