With the veto session a week away, Governor Jay Nixon continues to make his case that the legislature should not overturn his veto of HB 1329, a bill to allow the collection of sales taxes on vehicle purchases made out-of-state.
Nixon says of the more than 122 thousand Missourians that will face a retroactive tax bill if his veto is overturned, about 14,000 bought a vehicle from an out-of-state dealer. More than 108,000 were private transactions.
He says the issue is less about out-of-state vehicle purchases than it has been portrayed to be. “I felt like in the public there was this sense that those were all dealer or out-of-state, and when you see 89 percent this way, I wanted to get these facts out.”
The House sponsor of HB 1329, Representative Ryan Silvey (R-Kansas City), says 14,000 is still a large number of purchases. “If you’re okay with incentivizing 14,000 people to cross state lines to make the second largest purchase next to their house, then I guess it’s not a big deal, but as far as the legislature’s concerned it’s a big deal.”
Nixon says the passage of a use tax should be left to local jurisdictions to decide. “This is something that has been passed since the end of the legislative session in at least two jurisdictions … running around the voters for any tax, much less a retroactive one … to run around the voters, to say that you can go back and collect a tax for something that the court said was not taxable seems to be not good public policy, not good fiscal policy and as I said before, I just don’t think it’s right.”
Silvey says the issue is one of parity at the state level, and needs to be addressed at the state level. “Because of the way the court decision yanked these taxes out, the way that they were being collected, to have all 522 municipalities, all 114 counties try to address it piecemeal, then you end up with small inequities everywhere around the state. It makes much more sense just to take care of it the way we’ve chosen to take care of it, which is just to put it right back to the status quo. Nothing changes after this bill from before the (Supreme) Court decision. It’s the way it’s been for the last sixty years.”
Silvey says if the legislature does override Nixon’s veto and the Department of Revenue holds off on issuing tax due notices, lawmakers could then strip the retroactive component from the law in the next legislative session. “I’ve spoken with members of the Senate. Senator Kehoe is willing to file the legislation if I’m not there to file it myself next year.” Silvey is seeking election to the Senate in November.
Silvey says that would be preferable to letting the veto stand, while more out-of-state vehicle purchases are made.
Nixon says overriding the veto on HB 1329 could just set up another lawsuit similar to the one the Supreme Court ruled on in March. “Nothing in this bill would fundamentally change the underlying legal theory of this: that people need to vote if you’re going to have a raise in taxes.”
Silvey accuses the governor of playing politics with the issue. “If the governor really had substantive policy issues with this, he should have helped us address it during session. He should have worked with us to find a solution instead of waiting for us to go home, issuing a veto and then deciding to hold press conferences 60 days before a General Election.”
The veto session is a week from today.
AUDIO: Hear Mike Lear’s interview with Ryan Silvey, 5:48