August 22, 2014

Tax collections chart state recovery (AUDIO)

 

The state budget office has measured the impact of the 2008 recession on state programs and services. It also is measuring how Missouri’s economy is coming back.

A commission looking at how much money the state gives away in tax credits for economic development provides context for understanding the impact of the recession. The amount of money the state lets developers keep each year instead of paying in taxes is increasing rapidly while the tax income the state uses to finance services and programs is creeping back to pre-2008 levels.

State budget director Linda Luebbering says the state would have more than $9 billion in general tax collections if the economy had grown at the steady rate is was growing before the recession. But it is about $1.8 billion below that figure. She has used a series of images in explaining the numbers to a special commission evaluating Missouri’s 61 tax credit programs.

Luebbering says Missourians pay only 4.4 percent of their income in state taxes. People in 43 other states pay more.

The special commission is considering whether Missouri gets one-dollar in economic development for each dollar it provides in tax credits to developers, noting that the state spends more on tax credits than it spends on every state agency except for education and social services departments. .

 AUDIO: Luebbering presentation 16:42

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