COLUMBIA — A proposal by Missouri Realtors to bar a tax on real estate transfers would eliminate a revenue option that other states use.
The Missouri Association of Realtors on Sunday submitted petitions for a statewide vote this fall that would prevent state, county and local governments in Missouri from imposing any tax on the sales or transfer of homes or real estate. The issue could appear on the November ballot.
The tax is levied in 37 other states plus the District of Columbia, but there are no legislative proposals to introduce such a tax in Missouri.
Elizabeth Mendenhall, a Columbia resident and president of the 22,000-member Realtors Association that sponsored the petition, on Tuesday said the proposed constitutional amendment is a deterrent to introducing the tax in the future.
Mendenhall said the proposal would support the economy by keeping the housing market vibrant.
“We are fortunate to have more affordable houses in Missouri," Mendenhall said. "It is important that we do not have this tax in the future as it would make buying houses more expensive."
State Rep. Chris Kelly, D-Columbia, said “it is conceivable the amendment could reduce avenues for raising taxes in future,” and termed it as an attempt to fix “a nonexistent problem.”
Ed Robb, a policy analyst and former state representative, said the current dip in tax revenues has raised fears the state might opt to impose a real estate transfer tax but added that he was “not sure whether or not it is necessary” to enact the proposed amendment.
Mendenhall said the proposal would have “a zero effect” on Missouri’s fiscal position because the tax does not exist.
Realtors have termed it a “double taxation,” saying it amounts to paying tax twice because residents already pay annual taxes on their properties.
Robb, who has a finance background and previously taught economics at MU, said the tax in question does not qualify as a “double taxation” in the strict definition of the term.
“That’s a stretch. I would not agree in a strict sense,” Robb said.
A clear example of double taxation, he said, is the payment of taxes on dividends, which are already taxed at the corporate tax level.
The Missouri Association of Realtors announced Monday that it had collected sufficient signatures to submit a ballot proposal to the Secretary of State.
If the signatures are found to be from valid registered voters, then the proposal will be included on the ballot as a constitutional amendment in November’s general election.
Election officials have until Aug. 3 to certify the petitions for a statewide vote.
The Associated Press reported it would take 147,000 to 160,000 signatures for the proposal to be on the ballot.
Mendenhall said the association had collected “well above” the minimum number of required signatures.