Friday, January 28, 2011

Missouri Senators consider elimination of corporate franchise tax

Missouri business owners and representatives showed their support in front of the Senate Jobs Committee Wednesday (Jan. 26) for two bills that would effectively rid the state of the corporate franchise tax.

Committee Chairman Sen. Eric Schmitt, R-St. Louis County, sponsored the two bills and spoke to his fellow committee members about the franchise tax and its impact on corporate investment in Missouri.

"The tax was instituted about 100 years ago and is an outdated tax, created before there was a corporate income tax, and it's really a double tax on assets for businesses who already pay an income tax and sales tax," Schmitt said to the committee. "[Businesses] actually have an incentive to move their assets outside of the state, so this is really a disincentive for investment."

Schmitt sponsored two different bills on the issue:

A bill to freeze the franchise tax at the 2010 level.

A bill to phase out the franchise tax over the next five years.

No one has testified against either bill.

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