House Budget Committee Chairman Scott Fitzpatrick, R-Shell Knob, says forecasting next year’s state budget situation is tougher than it has been in previous years he’s served in the Missouri Legislature. Fitzpatrick tells Columbia radio station KSSZ that proposed changes to federal tax policies are part of the issue.
“It throws a bit of uncertainty in the process that I have not experienced,” he says.
If the GOP tax plan being drafted in the U.S. House is passed, its impacts will be felt at the state level. Among other things, the legislation would lower the corporate tax rate to 20%, limit the mortgage interest deduction and eliminate a deduction that covers high medical costs for seniors. It would also repeal tax-free tuition waivers to graduate teaching or research assistants. The provision means those college students could have their federal taxes increase up to 350%.
Fitzpatrick says figuring out the right levels for state taxes is a balancing act.
“There’s a place where that tax rate is too high and people won’t want to come and then there’s a place where the tax rate is so low that you may get plenty of economic activity but your rates and tax structure are inadequate to fund the government,” he says.
According to Fitzpatrick, it’s too soon to tell what type of funds Mizzou can expect in next year’s state budget.
“As a state legislature, we need to realize that the University of Missouri is one of, if not the greatest, asset that the state has in a lot of ways and that we need to make sure that it’s set up to succeed,” he says.
Fitzpatrick discussed the state’s upcoming budget at the Daniel Boone Regional Library in Columbia on Tuesday.
Hank Koebler of KSSZ in Columbia contributed to this story.