Eigel, Koenig tag team tax reform in Senate Ways and Means Committee

JEFFERSON CITY, Mo. — The junior senators from the St. Louis region, Sen. Andrew Koenig and Sen. Bill Eigel, have taken a large task upon themselves in their mission to reform the state’s tax code, and their fellow senators on the Senate’s Ways and Means Committee were more than willing to tell them so.

Koenig’s SB 611 and Eigel’s SB 617 both look to bring about reform, an item that has been at the forefront of politics not just statewide, but nationally as well.

Eigel’s legislation is a broad and bold proposal, which starts with scrapping the current system of personal income taxation and drop the top income tax rate from 5.9 percent down to 4.8 percent. Eigel explained that his plan would eliminate the bottom four tax brackets to alleviate the burden on those citizens.

The plan would, over the course of decades, eventually eliminate Missouri’s individual income tax, which he says would be replaced by the sales tax revenue.

Eigel’s plan also calls for the capping of tax credits and repealing the state deduction for federal income tax liability. In addition to that, his plan includes a few other tax proposals, which he says might never pass the General Assembly unless it’s part of a larger overhaul package.

A perfect example of this is raising the states’ fuel tax from 17 cents to 23 cents per gallon.

Koenig’s version of the tax overhaul is less dramatic, although it would decrease the top individual income tax rate no Lowe than 4.3 percent. It also would cut the corporate tax rate from 6.25 percent to 4.25 percent, and cap local sales tax rates at 7.275 percent. Hisbill also calls for a streamlined sales tax, a nonrefundable earned income tax, and a four cent gasoline tax increase.

As with any tax reform measures, it can be hard to sway colleagues to view the proposal the same way, but the two younger senators both approached the issue with an eagerness.

“People and money seek out economic freedom,” Koenig told the committee. “The income tax is destructive to economics.

Eigel was equally strong in his statements, telling the committee that it was “incumbent upon the General Assembly to describe what a better tomorrow looks like.

“We’re spending a record amount these days, yet it’s not improving our economic standing,” he said.

Fielding questions from the panel of senators together, they told the committee that the seven states who do not currently have an income tax are growing at a faster rate than Missouri. They stated that their plans were simply an attempt to model the state’s tax code to those with the most successful plans.

Sen. Bob Onder thanked the senators for tackling such a major issue, saying that the question was simply this: “Do we want to be in the biggest winner column or the biggest loser column?”

Enter Sen. Jamilah Nasheed.

The senator, along with Sen. John Rizzo, led the questioning against the bill, with Nasheed taking the lead.

Nasheed noted a number of issues concerning the tax environment of the state, including the recent vote not to fund low-income housing tax credits in the coming fiscal year. She also questioned whether this was simply another break for corporations and the rich.

“I don’t have an appetite right now to give tax cuts to corporations,” she said.

When Sen. Koenig began to respond to one of her queries, she told him not to worry:

“Oh, this bill isn’t going anywhere.”

She did, however, later state that she hoped they could all find common ground that benefitted everyone.

The real issue, however, seemed to be whether or not the tax reform measures would take the Show-Me State down a path similar to that of Kansas.

Both Eigel and Koening explained that they believed the difference was that Kansas bit off too much in their mission to cut taxes, and failed to roll back their spending.

The hearing, in all, lasted roughly three hours, before the senators headed to the Senate chambers for the session.

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