MEASURES CUTTING INCOME TAX, RAISING SALES TAXES: The House Special Committee on Tax Reform began hearings on wide-ranging legislation that is intended to lead eventually to elimination of the state income tax, while making up billions in lost revenue through increased sales taxes. The sales taxes would include taxing services Missourians use every day, from haircuts to car repairs to REALTOR® services.
Enacting such a sales tax on services would require first repealing and replacing a constitutional protection against the taxes that was promoted to successful passage in 2016 by Missouri REALTORS®. Repealing and replacing the current constitutional language would require approval by voters statewide. The legislation is House Bill 100 and House Joint Resolution 1.
From St. Louis Post-Dispatch’s coverage of the hearing:
“Under a package of legislation sponsored by Rep. Bishop Davidson, R-Republic, Missouri’s current 4.7% tax rate for most taxpayers would drop to a flat rate of 4% next year and begin a phased-in elimination of the tax, potentially costing state coffers more than $8.4 billion annually.
The move would be paired with a constitutional amendment asking voters to allow taxes to be levied on services like haircuts, lawncare and real estate services to help replace the loss of income tax revenue — a move that could trigger significant pushback from the business community.
“The main goal is to eliminate income taxes,” Davidson told members of the House Special Committee on Tax Reform.
Sam Licklider of Missouri REALTORS® told the panel that the powerful lobbying group is opposed to the provision because of the imposition of a tax on services.
“This is not a tax reduction. This is a tax switch … . It is going to injure lower income people,” Licklider said.
The Columbia Missourian reported, “There are currently 42 bills filed in the Missouri House to lower taxes ranging from personal property to bingo cards to emergency services.”
LEGISLATIVE ACTION: There was progress this week in Jefferson City on key bills of interest to Missouri REALTORS®.
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The House Financial Institutions Committee conducted a hearing on HB596, dealing with brokerage services, with Missouri REALTORS® lobbyist Jason Zamkus testifying in support. The legislation requires a real estate broker acting as a single agent for a buyer or tenant to enter into a written agency agreement with the buyer or tenant before engaging engaging in specified activities. The bill is sponsored by Rep. Chris Brown, R-Kansas City
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Combined House Bills 595 and 343, prohibiting political subdivisions from requiring property owners to accept federal or other housing assistance programs, was recommended for passage by the House Committee on Rules, Administrative. It is now on the floor schedule for House Bills for Perfection. HB595 is sponsored by Rep. Chris Brown, R-Kansas City, and HB343 is sponsored by Rep. Ben Keathley, R-Chesterfield.
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Also clearing the House Committee on Rules, Administrative, was the combined House Bills 594 and 508, allowing deduction of capital gains from income subject to state taxation. The bill also moves to the House Perfection Calendar. HB508 is sponsored by Rep. George Hruza, R-St. Louis County, and HB594 is sponsored by Rep. Chad Perkins, R-Bowling Green.
ALEX TUTTLE JOINS LOBBYING TEAM
Alex brings a strong background in budgeting and taxes – both critical areas of focus this legislative session. He has more than 15 years of experience in Missouri’s legislative and executive branches, including as Legislative Budget Director for Gov. Mike Parson, Legislative Director for the Missouri Department of Health and Senior Services, and Budget Analyst for the Senate Appropriations Committee. Alex has successfully led multibillion-dollar budget initiatives, secured key legislative victories, and built strong relationships to advocate for economic development, infrastructure, and tax policy reforms.
Alex will be present during our REALTOR® Days at the Capitol, and we look forward to having you meet him. Jason Zamkus will also be front-and-center during the pre-meeting briefings with members, providing the latest updates on the current status of our legislative issues. Alex’s budgetary expertise complements Jason’s expertise in drafting legislation and providing sharp legal insights, ensuring our initiatives are both strategic and effective, while chief lobbyist Sam Licklider continues to be a valuable resource with historical knowledge spanning 50-plus years that provides context and guidance to shape our advocacy efforts.
To view additional resources and information, visit our Legislative Priorities and Updates page.