I recently noticed a cartoon that stated, “Due to budget shortages, the light at the end of the tunnel has been turned off.” That is not true at the Capitol where we have two weeks left in this legislative session. Several big issues that have been a concern are close to completion and there is a mad scramble to pass legislation that individuals feel is important to their districts.
The budget, which is the biggest responsibility of the General Assembly is now in conference and will probably be finalized this week. The redistricting map, which has been very controversial as it bounced back and forth between the Senate and the House has been agreed on and sent to the Governor. The compromise on Proposition B, which has been debated all session, has been signed by the Governor and several initiatives that were set forth at the beginning to help make Missouri more business friendly have been passed.
One of those bills signed into law last week will phase out a tax that applies to more than 3,000 businesses currently operating in Missouri. SB 19 will gradually eliminate Missouri’s franchise tax on company assets such as buildings and inventory. The franchise tax has been in existence since 1917. While the legislature has reduced the tax over the years, leading business organizations have proposed doing away with the tax entirely as part of the “Fix the Six” legislative package. The bill we approved will reduce the tax each year until it is phased out entirely in 2016. Missouri is one of only a few states that have both a corporate income tax and a corporate franchise tax. By eliminating what is, in effect, double taxation, we fan put Missouri on a level playing field with other states that are competing to attract new businesses and jobs.
Another bill on its way to the governor’s desk for approval is one I mentioned in a report early on in the legislative session. Last week the Senate finally sent back to us a slightly revised version of the “Big Government Get Off My Back Act” that was passed by the House in January.
If signed into law by the governor, the act will limit federal mandates on small business owners in the Show Me State. In addition, the bill would increase the size definition of small businesses and require that any federal mandates on these businesses be approved by the General Assembly. With both of these provisions, we hope to allow businesses to operate without fear of new regulations or mandates that will negatively impact how they do business. We think it’s a key component to our efforts to revitalize our economy.
Another portion of the bill further helps small businesses by providing tax deductions to small employers who create new full-time jobs with annual salaries that meet the county average wage. Under the bill, a small business would be able to deduct ten thousand dollars for each full-time job created or twenty thousand dollars per new job if the employer offers health insurance for the new employees and pays at least half of the premiums for such insurance.
Two weeks left and the light at the end of the tunnel is coming into view.
If you have questions, you may reach me at my Capitol number 573-751-9465, at the local district number, 660-582-4014, by email at mike.thomson@house.mo.gov or by mail at Room 401B State Capitol Building, Jefferson City, MO 65101
