Sep. 23—A tax cut bill has advanced through the Missouri Senate in a special legislative session and is now on its way to the House, but there is some contention if this is the proper use of the Missouri budget surplus.
The tax cut proposed by the Senate is close to what Gov. Mike Parson, R-Mo., originally suggested ahead of the special session as they elected to start the first year with a slightly more modest cut to ensure sustainability.
Aaron Hedlund, chief economist for the Show Me Institute, a Missouri-based think tank, said they see this proposed tax cut as sustainable and will directly battle inflation getting dollars back into Missourians' pockets.
"This is really a first step in the right direction of making us a more attractive state for workers to stay here, workers to come here, businesses to invest and relocate and expand here, so I think it's a good move," Hedlund said.
The argument against the tax cut is it is an example of trickle-down economics and the wealthiest are getting a higher benefit.
"If by trickle down we mean let's give the money to rich people and then hope it comes back to everybody else, I don't think that works, but tax cuts aren't about giving money to rich people," Hedlund said. "Tax cuts are about people keeping more of the money they earned, which means that the return the economic value of doing productive things like working and investing gets higher."
On the other side, representatives with the Missouri Budget Project, a budgetary nonprofit, said they believe this tax cut is irresponsible and money could be used for social services or school while also expressing concern about the sustainability of Missouri's budget.
"We're worried about the long-term effects on our ability to fund our schools, to fund social services, fund our roads, all of the things that kind of we all rely on to build opportunity for our families. Even in these rosy budget times, we have a lot of unmet needs with casework occurs in foster care or mental health services," said Traci Gleason, Missouri Budget Project spokeswoman.
Gleason said money is going to the top, and the average Missourian will only see around $6 a month in relief on their taxes. In comparison, a millionaire will receive several hundred dollars a month.
State Sens. Dan Hegeman, R-Cosby, and Tony Luetkemeyer, R-Parkville, both said the Senate came to a good conclusion and they support the tax cuts.
"I'm very happy with the proposal we put to the House. This will be the largest tax cut in Missouri history. Right now we are dealing with the land of inflation caused by the broken policy of the Biden administration ... at this critical moment need to make sure we are putting money back into the pockets of hardworking Missourians," Luetkemeyer said.
Hegeman echoed Luetkemeyer's thoughts on the need for the tax cut and as outgoing appropriations chair, he said the budget can withstand the tax cuts.
"We basically have a flat tax in Missouri ... if you are working any type of job you go to the top tax bracket ... it helps almost all of Missourians," Hegeman said.
Clayton Anderson can be reached at email@example.com. Follow him on twitter: @NPNowAnderson.