Blunt backs tax break for military retirees

SPRINGFIELD — Military retirees in Missouri might have a state tax cut coming, if lawmakers go along with a proposal by Gov. Matt Blunt.

The governor proposed Monday to eliminate the state income tax on military pensions for tens of thousands of veterans in Missouri. The tax cut would cost the state about $24 million a year, Blunt said.

Veterans officials said the tax cut was one of their priorities.

“This will be a big help, especially for the World War II generation,” said Bernadette Miller, vice chairman of the Missouri Veterans Commission.

Of the 41 states that have an income tax, 12 do not tax military pensions, including neighboring Illinois, the governor’s office said.

Blunt outlined the proposal at a Veterans of Foreign Wars post in Springfield, the first of several statewide stops to promote the tax cut.

The tax change would need approval by the legislature, which starts its 2008 session Wednesday.

“I think there will be strong support in the legislature,” Blunt said.

He was flanked by state Sen. Jason Crowell, R-Cape Girardeau, head of that chamber’s veterans affairs committee, and House counterpart Rep. David Day, R-Dixon. Both men said they supported the tax cut.

“The best that we can do to help is to let you keep more of your money in your wallet,” Crowell said.

The governor said state economic growth made the tax break possible without having to cut any programs or raise taxes elsewhere.

The proposed tax cut for military veterans follows one enacted last year for retirees in general. The 2007 law exempted additional Social Security benefits and certain other retirement benefits from the state income tax. Those tax cuts are projected to cost $154 million when fully phased in by 2012.