A conservative Missouri State Senator announced on Facebook Monday that he intends to introduce legislation to overhaul part of the Missouri tax code.
Republican Bill Eigel of St. Charles calls his Missouri Economic Relief Act (MERA) the largest tax reform legislation for Missouri in several generations. Among other things, he says it will eliminate the bottom four brackets of the income tax code.
Missouri has 11 brackets in all, with the bottom four dealing with taxable income of $4,000 or less. Most Missourians fall in the top bracket, which covers incomes over $9,000. It starts at amount more than $3,000 below the federal poverty level of $12,060.
Eigel says his proposal will drop the top business income tax from 5.9% to 4.8%. A tax bill passed by the legislature several years ago kicked in this year, dropping the business rate from 6% to 5.9%. The law triggers a modest .1% cut when certain tax collection benchmarks are met.
The freshman Senator’s plan would far exceed the existing law’s maximum impact, which reduces the business income tax to 5.5%. In his Facebook posting, Eigel said, “There’s no better growth incentive we can offer business owners than more of their own capital.”
His MERA proposal also caps the amount of new tax credit authorizations 30% below current levels. Eigel contends the state’s tax credit programs need to be reformed, and says he’s long been in favor reforming the code to reflect changing times.
In a departure from what he’s previously said, Eigel says his plan also adjusts the fuel tax rate to access short term money for the roads and bridges.
As a member of the Missouri 21st Century Transportation Task Force, he’s consistently indicated he would oppose raising any taxes to pay for transportation. At a September task force hearing, Eigel said, “I think there is a lot of frustration out there from citizens who are tired of government officials solving problems simply by asking the taxpayer for more money.”
His Facebook posting didn’t specify what “adjusting” the fuel tax would entail.
He finished by stating his MERA proposal would provide relief to all working Missourians and put the state in a position to lead the region in economic growth.