Missouri could completely overall the method it uses to fund state government under a plan passing the House and moving on to the Senate.
Supporters call it the Fair Tax. Opponents have other names for it. Whatever label it is given, HCS HJR 36 has been approved by the House on a 90-to-65 vote.
Rep. Roman LeBlanc (D-Kansas City) charges that the so-called Fair Tax would hurt senior citizens who no longer pay state income taxes, but would be hit with a higher and broader state sales tax.
"This would be a tax shift from our wealthiest citizens in the state to our Middle Class," LeBlanc says. "And our Middle Class in this country has been under the greatest attack that we’ve ever seen in the history of our country."
LeBlanc notes that even white-collar, professional jobs have fallen victim to the recession. He worries about the long-term viability manufacturing jobs such as those created by General Motors, Ford and Chrysler.
The Fair Tax is a concept that relies on sales taxes to fund governmental services. The measure approved by the House would do away with the state income tax, both on individuals and corporations. It would replace that tax with a sales tax a bit over one percent higher than the current 4.225% state sales tax. Nearly all exemptions would be eliminated, even those for doctor visits and prescription drugs.
It is meant to be revenue neutral with the state not gaining or losing revenue through the change.
Sponsor Ed Emery, a Republican state representative from Lamar, argues the Fair Tax is simpler than the current tax system and rewards prosperity.
"Prosperity is what pays the bills that we have in this state," Emery says. "It’s not taxes, because you can have an unbeliever able tax rate, if nobody has any money, then it’s worth nothing. This way, we reward that prosperity and what we punish is over-consumption."
The debate now shifts to the Senate. If the legislature would approve the resolution, it would go to the ballot