With the 2021 Missouri legislative session almost over, it has become most evident that the GOP-dominated legislature wants to financially harm this state and its citizens in order to support large corporations and the financial top 1% of the population.
Remember the tax bill you received from the county concerning your personal property taxes? State Sen. Bill Eigel, R-Weldon Spring, has proposed a Joint Concurrent Resolution that would ask the citizens of the Show-Me State to eliminate all personal property taxes through a ballot initiative.
However, Stone County Assessor Matt Daugherty wrote that “… property tax remains a mainstay of local government finance in Missouri. It provides a major source of revenue for most local governments and will continue to be important to them.”
Eigel is a powerful person in the state Senate as the vice-chair of the Ways and Means Committee, which works on “revenue and public debt of the state, and interest thereon, the assessment of real and personal property, the classification of property for taxation purposes and gaming.”
He should know that it takes money to operate the services of the state, including the state highway patrol, transportation and infrastructure, K-12 education, state colleges and universities and the judicial system, to name a few. Eigel also sits on the committees that oversee each of these entities.
According to the resolution, this would be the largest tax cut in Missouri history.
Why does Eigel want to eliminate personal property taxes through SCR 19?
Eigel gives three reasons. The first is that the citizens of this state are “better stewards of their money” than the state. Of course we are, which is why there were over 17,000 personal bankruptcies in 2019 in Missouri.
Second, other states have no personal property taxes. This is not exactly true. Some 23 states have no personal property tax on motor vehicles but do on other personal property. Eleven states have some of the lowest personal property taxes, including our neighbor Arkansas to the south.
Third, personal property taxes go up year after year. Of course they do in real dollars. The cost of a new car has increased dramatically over the last decade. I remember when a basic Chevrolet Camaro cost about $2,500. Today, a new Camaro will set you back somewhere from $25,000 to upward of $60,000.
To offset the loss of revenue, states usually have higher taxes on gasoline, sales and income. In Missouri, the state portion of the sales tax is about 4.2%. In Arkansas, it is 6.1%. Our fuel tax rate is $0.17 per gallon. In Arkansas, you will pay $0.245. Income tax in Missouri is 5%; in Arkansas, it’s 5.9%.
We still have to pay for state- and locally provided services, so where would the money come from?
Would this initiative require that I-70, I-44 and I-55, along with U.S. and state highways, become toll roads, or should the state charge a tire tax?
Would this initiative require our public schools to charge tuition to offset the loss of revenue?
Would local fire and police departments charge fees for responding to an emergency?
Would there be a special levy to fund our state legislature?
There is another problem with this bill: It may be overly difficult for the citizens of the state to initiate a ballot petition if HJR 20, as discussed in my April 7 column, passes through the legislative process and is signed by the governor. (Doesn’t the Senate right hand know what the House right hand is doing?)
Many cities and counties have provided tax incentives for companies to move to their jurisdictions. These incentives usually include waiving the collection of personal and real property taxes for a set number of years — a loss of revenue that must be replaced by taxing the citizens of that jurisdiction.
I anticipate that SCR 19 would also negatively impact our poorer citizens and citizens of color. Sure, they would have a few extra bucks in their pocket at the end of the year, but the foreseeable increases in other revenue-generating taxes and fees will negatively impact them as opposed to people of means.
I am an advocate of fair taxes levied on the citizens of our state. I also advocate that state and local entities be properly funded and our local and state employees paid a fair and livable salary.
We cannot continue to cut taxes willy-nilly; they must be offset by either the increase in other taxes or reductions in services. I would rather receive one tax bill at the end of the year for real and personal property taxes than pay other higher taxes and fees to offset this poorly thought-out resolution.