COLUMBIA, Mo. (AP) — Missouri lawmakers on Thursday gave final approval to an income tax cut called for by Gov. Mike Parson while ditching a last-minute proposal to cut corporate taxes.
The Republican-led Missouri House voted 98-32 in favor of the bill, which would cut income taxes from 5.3% to 4.95% beginning next year and phase in additional cuts until the rate hits 4.5%. The bill applies to the top income tax rate, which covers those who make more than about $8,700 a year in taxable income.
The additional cuts would be triggered by revenue growth benchmarks tied to inflation.
The roughly $1 billion measure also eliminates the lowest tax bracket, meaning earners who bring in less than about $1,000 a year no longer will have to pay state income taxes.
The measure now heads to Parson, who is expected to sign it. The Republican governor called lawmakers back to work to spend some of the state’s record revenue surplus on tax cuts.
“We are thrilled that the General Assembly has answered our call to cut Missourians’ taxes and return some of their hard-earned dollars,” he said in a statement.
If Parson signs the bill into law, taxpayers who make between $22,000 and $66,000 a year would on average see savings of between $10 and $50 next year because of the income tax cut, according to an analysis by the Missouri Budget Project. The organization analyzes state budget policy and its impact on low-income families.
Once the income tax rate hits 4.5%, savings for those workers would amount to roughly $29 to $131 a year on average, according to the same analysis.
Earners who make $66,000 to $110,000 a year would on average see about $120 in immediate savings and $275 a year once the full tax cuts kick in.
And taxpayers who make more than $552,000 a year, or on average about $1.6...
