National tax cut battle turns intense in Missouri

Governor defends his veto of state's income tax rate cut
Associated Press
Aug 27, 2013

Millions of dollars spent broadcasting ads. Alarming fliers and phone calls targeting homes. Politicians barnstorming from one press conference to the next.

By most measures, Missouri appears in the midst of another high-stakes election — except there is nothing on the ballot this year.

The massive campaign is meant to persuade — or dissuade — a few wavering Missouri lawmakers who will decide in September whether to override the governor's veto of the state's first income tax rate cut in nearly a century.

The Missouri battle is one of the most the intense yet in what has become a nationwide offensive by conservatives in state capitols to slice the income taxes that for decades have formed the financial foundation for government services ranging from public schools to prisons. They contend the tax cuts are the path to economic prosperity. Others forecast financial ruin.

About a dozen states already have cut income taxes this year, including sweeping changes to tax codes in Kansas and North Carolina and a ratcheting down of rates in Arkansas, Indiana, Ohio and Wisconsin. Conservative lawmakers who gathered at a conference this month in Chicago received a how-to pep talk meant to spread the tax-cutting movement even further in 2014.

"This is a national agenda — there's a lot of other people that have interest in trying to create jobs in America," said Travis Brown, a St. Louis-based lobbyist and convention speaker who has traveled to 29 states this year promoting lower income taxes.

One of Brown's biggest benefactors, retired investment firm executive Rex Sinquefield, has poured about $2.4 million into an advertising campaign meant to encourage Missouri's Republican-led Legislature to override Democratic Gov. Jay Nixon' veto of the tax cut. The campaign includes the state's biggest businesses associations and conservative activist groups such as the Missouri Club for Growth, which has threatened to drop support of any lawmaker who opposes the tax cut.

The tax-cut plan even has gotten the attention of Republican Texas Gov. Rick Perry, a potential 2016 presidential candidate who seized upon Nixon's veto to target Missouri with TV and radio ads recruiting businesses to Texas. Perry is to headline an event Thursday in suburban St. Louis sponsored by a coalition pushing for a veto override.

Opponents of the tax cut have responded with mass mailings and phone calls targeting residents in 15 House districts whose Republican legislators seemed susceptible to being swayed. They have been aided by public school boards warning the tax-cut would jeopardize education funding and undermine the economy.

Nixon added leverage to his veto by withholding $400 million from education, building projects and other services because of concerns that the tax cut would bust a hole in the budget. The governor said he would release the money only if lawmakers sustain his veto. During the past six weeks, Nixon has held roughly 30 public events to rally support for his veto.

"We've worked very hard over the last four years to hold the line on taxes; we're one of the lowest taxation states in the country," Nixon said recently. But "this bill is not the right way to go about it."

The state school boards' association has warned of consequences such as crowded classrooms and lower graduation rates.

The Missouri measure would gradually cut the corporate income tax rate nearly in half and lower the top individual tax rate from 6 percent to 5.5 percent over the next decade, but only if state revenues rise by at least $100 million annually. It also would phase in a 50 percent tax deduction for business income reported on individual tax returns and increase deductions for low-income individuals. It would trigger even more income tax cuts if Congress passes a measure making it easier for states to tax online sales.

Missouri's tax plan was prompted largely by a desire to keep pace with neighboring Kansas, where Republican Gov. Sam Brownback signed tax cut measures each of the past two years.

There's no definitive evidence yet whether the Kansas tax cut will boost or deplete state finances. Kansas tax revenues rose 2.7 percent during the fiscal year that ended in June, which included six months under the new tax cuts. Missouri revenues grew 10 percent during the same period.

Yet Kansas was presented as a shining example during a recent conference of the American Legislative Exchange Council, an association of conservative lawmakers and businesses that crafts model legislation for states.

"The opposition was looking at (the tax cut) and saying these are draconian cuts — you'll not be able to support your school system, the education system, the core services of government," said Kansas Rep. Richard Carlson, a Republican who is chairman of the House Taxation Committee. "I maintain we cannot support those core services of government unless we grow the private sector."

The fate of Missouri's tax cut may rest with a few House Republican holdouts. A veto override requires a two-thirds majority — meaning all 109 GOP House members must vote for the override if it is to succeed without Democratic support. Republicans can afford to lose one of their own in the Missouri Senate and still override the veto.

Rep. Elaine Gannon, a retired teacher from Nixon's home town of De Soto, is one of the few Republicans to say she may vote "no." She cites concern about education funding.

"But boy, they're spending a heck of a lot of money" to persuade her to vote "yes," Gannon said.

Rep. Lynn Morris is leaning toward a "yes" vote despite hearing a personal plea from Nixon and getting targeted with fliers, phone calls and emails from tax-cut opponents.

"I'm sad that we've got two different groups spreading such a diverse amount of information out there," Morris said. "It's even confusing to legislators — I'm sure it's confusing to the public.

 

Comments

The Big Dog's back

Good that the Gov had the courage to stand up against those trying to destroy our country.

MiddleRight

Yes, reducing taxes on working people is what will destroy this country.

The Big Dog's back

It's not reducing taxes on working people. As a matter of fact the sales tax increases taxes on working people.

Sarrak

Author Samuel L.Clemons (Mark Twain) once wrote: "Democracy is safe from everything except Democrats". Democrat Gov. Nixon is just the latest example.

Fromthe419

The interesting thing is if you read the Constitution, no where in it does it state we are a Democracy, we are a Republic. The founding fathers created a republic with limited government and was all about states rights. We have been shifting towards what the founding fathers warned about in the Federalist's Papers. We are a nation of laws.

MiddleRight

Stop right there. This President has never read the constitution and doesn't care what's in it.

coasterfan

Sarrak: since it's Republicans who are threatening to shut down our federal government, and Obstructionist Republicans who stand in the way of any compromise in Congress, reality indicates that exactly the opposite is true in 2013.

Seriously, you have to go back 120 years to find a quote to make the GOP seem like the good guys? Nice try...

registerer

Or.....since the dems are hellbent on financially ruining this country it is nice to see the gop trying to hold someone accountable for their open checkbook policy!

I would like to say thanks to the gop for their position on the debt ceiling. It really is simple coaster, once Pres. Obama gets serious on his frivilous spending and start cutting back then the gop will "reward' him by raising the ceiling.

MiddleRight

Republicans are stopping the further destruction of this economy and country.

Can anyone disagree that we are heading in the wrong direction?

The Big Dog's back

We are now heading in the right direction with Obama. Repubs already ran up the debt. Our country needs to pay it's bills.

The Hero Zone's picture
The Hero Zone

I will be ecstatic if these state Reps and Senators would ensure they represent their constituents and not their parties, to whatever end that takes things. This is a matter that makes it worth holding town halls and other meetings to try and work out what is best. That is the true and best exercise of leadership. The quote at the end actually made me happy to read. Someone who recognizes and expresses that an answer must be sifted out of the rubbish, polished, addressed, then put out with everyone knowing what is going into (and come out of) the action. Think of all the money that is/was wasted on these party line spam calls and junk mail that could be put into local venues to hold public discussions.

The Big Dog's back

What party votes in lockstep? Repubs, look it up.

The Hero Zone's picture
The Hero Zone

Am I discounting the ACA being passed from this research? Otherwise when searched I find copious amounts of articles about both sides voting in that manner. It furthers the point about how narrow-minded it can make leaders when all you have to do is vote the way your party tells you. Or if not that, how many people elected into positions have a vast array of opinions but are cowed into casting their vote for something that may undermine their opinion?

What would you say to an amendment that mandated every bill be put on public display, unaltered from its original or final/amended form, for a minimum of 30 days prior to voting so that the public can read it, understand it, and provide feedback to their elected representatives? Of course there would have to be an exception such in the case of some emergency where a super-majority of both houses of Congress can overrule that in, say, a war or supreme budgetary crisis.

That sounds like an unbiased way to allow for communication among constituents and officials alike. It knows no party boundaries and fosters a constructive dialog about important issues that will also take into consideration any oversights the bill may have. For example, the hastily-passed New York gun control law that didn't exempt police from magazine restrictions. It also takes the emotion out of an argument and fosters concepts such as logic and consequences.

grumpy

That would be along the lines of what this administration promised 4 or 5 years ago. Although I think it was to be online for 15 days, before it was ignored as is so many political promises for the last few decades.

I like it but as shown above it will not happen with the current crop of politicians we have. The parties will lose their power and the people would gain some. The politicians won't let that happen. They may promise it again several times but it will be like many promises, the check is in the mail, I will love you forever, I won't c@&e in your m*&^% ...

Sam

A democrat against lower taxes on working people, typical.

arnmcrmn

very typical, because most dem voters don't pay taxes, so why would they care.

registerer

Unless I missed it I find it interesting that Ohio is listed above for cutting it's income tax. However, Ohio is increasing its sales tax to offset the reduction of income tax.

Stop It

You people are insane if you think that the Demos and Repubs are not working towards the same goal. How do you think we are this far into the crap?

They are playing us against each other.