Missouri House votes to ease small business regulations

Wednesday, April 15, 2009 | 4:14 p.m. CDT

JEFFERSON CITY — The House gave initial approval Wednesday to legislation intended to help Missouri's small business owners by reducing costs and barring new regulations for the next three years.

The bill would allow businesses to keep a larger percentage of sales taxes they collect during the next three years and would permanently exempt some employers from having to pay workers the minimum wage.

It would also ban increases on state user fees and new regulations on small business for three years.

Rep. Mike Dethrow, R-Alton, said small companies are struggling and deserve a break from government regulation during the recession.

"It's a message to government from small business to get off our back," Dethrow said.

One provision of the bill would allow all businesses to keep a larger percentage of sales tax revenue as a reward for turning in tax receipts on time. Currently, businesses can keep 2 percent of the sales taxes they collect. The bill would increase that to 3 percent until July 1, 2012.

Dethrow estimates that provision would cost roughly $15 million in lost state revenue.

But officials with the Office of Administration estimated that cost could be upward of $42 million.

The bill also expands the number of businesses that wouldn't have to pay workers the minimum wage. Currently, workers in businesses that make less than $500,000 in annual sales are not subject to the wage law. The bill would exempt companies that make up to $1 million in yearly sales.

Dethrow said he is unsure how many businesses the change would cover but that it would help some companies stay afloat.

Last week, the House gave initial approval to a bill that would remove future minimum wage increases for tipped workers.

Rep. Michael Frame, D-Eureka, said he didn't like the trend of exempting more workers from the minimum wage.

"This is a shame that you would be trying to resolve the economic crisis on the back of those who can least afford it," Frame said.

Rep. Darrell Pollock, R-Lebanon, said the state should help "crumbling" businesses with their top expense, labor.

"They are failing an at enormous rate," he said. "If these small businesses fail, so do their employees."

Additionally, the bill would grant a three-year moratorium on all increased user fees and new regulations for small businesses. Dethrow said a break in regulation would save companies money during the recession.

Some Democrats warned that banning new regulations could lead to workplace safety or environmental hazards.

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