Tax Experiment Proving Troublesome for Kansas EconomyRecent data released by the US Bureau of Labor Statistics shows what we have been saying all along: extreme tax changes do not help the economy, they hurt it.
Reckless Tax Legislation Slashes Funding for SchoolsSeveral bills filed this year propose the same recycled tax policies from last year, except some are even worse, blowing more than a $1 billion hole in the state’s budget. The results are the same too; the policies will take dollars out of classrooms, lead to tuition increases for college students, and stall Missouri’s economy.
The Missouri General Assembly is considering tax scheme legislation this year that will take dollars out of classrooms and cut funding to other critical state services.
With a budget hit that could exceed $1 billion annually when fully phased-in, every public service is bound to be impacted, including state aid to public colleges and universities. Higher education is typically the first area of the budget hit when the state faces budget shortfalls. That means more pressure to hike tuition to make up the difference, which translates into a hidden tax increase on middle-class families with college students. Just look at Kansas. After making drastic changes to their tax structure, colleges and universities in the Sunflower State are making
up the difference by increasing students’ tuition at several times the rate of inflation.
The tax schemes will devastate financial aid and scholarships for higher education as well. These include the A+Scholarship Program, a program that pays students’ tuition for community colleges if they get good grades and engage in community service; Access Missouri, a needs-based aid program providing financial assistance to low-income families; and Bright Flight, a scholarship program that offers an incentive for Missouri’s most talented students to attend college in the Show-Me State. The tax schemes that the General Assembly is considering threaten all of these programs and many more, putting college out of reach for many students and making it more difficult for them to reach their full potential.
The cuts to higher education funding also will cause colleges and universities to reverse course on plans for new programs and initiatives designed to spur economic growth in their local communities and across the state. Higher education institutions often serve as the nucleus for local communities and, to a broader extent, serve as economic development incubators for the state. If these tax schemes take effect, Missouri’s economic engine will stall, leaving the Show-Me State on the sidelines, while states that invest in higher education thrive.
The Coalition for Missouri’s Future is extremely disappointed that the Missouri House has approved more state tax schemes that will jeopardize funding for our public schools and other essential services for years to come.
Last summer, Missourians asked legislators to protect education and critical services throughout Missouri. However, House Bills 1253 and 1295 would threaten state funding for education, health care, public safety, and social services.
It is especially ironic that the House would act to reduce state revenue while at the same time claiming there is insufficient revenue to fully fund the school foundation formula within the next two years.
While the Coalition for Missouri’s Future supports policies that simplify and modernize Missouri’s tax structure, bolster the economy through tax cuts for the middle class, and preserve funding for the public investments that serve as the foundation of our state’s economy, HBs 1253 and 1295 fail to meet any of these criteria. read more…
The Coalition for Missouri’s Future applauds bipartisan discussion of Missouri’s funding needs. We are also happy that the Governor has strongly stated that Missouri must fully fund the state’s K-12 funding formula before tax cuts will be considered.
The Coalition will measure any tax proposal against our goals around tax policy. Any tax policy should modernize our tax structure, bolster Missouri’s economy, and provide adequate revenue to protect vital public services and works that strengthen our economy.
The Coalition is currently reviewing the framework of the proposal and will be evaluating details as they emerge.
The Coalition for Missouri’s Future is extremely disappointed that legislators would ignore the will of their constituents by continuing to consider irresponsible tax cuts that would gut the public investments that serve as the foundation of our economy.
Last summer, Missourians asked legislators to protect education and critical services throughout Missouri by upholding the veto of House Bill 253. But now Senate Bill 509, currently under consideration in the Missouri Senate, would cost the state nearly $1 billion in revenue, threatening state funding for education, health care, public safety, and mental health services. State funding for K-12 education could be reduced by as much as $334 million when the bill’s provisions take full effect.
The bill not only disproportionately benefits the wealthy at the expense of lower-income and middle-class taxpayers, it jeopardizes state funding for critical public services and infrastructure including schools, health and mental health services, and investments in technology.
Instead of pursuing tax cuts that have failed to generate growth in other states, Missouri legislators should focus on strengthening our state’s economy by developing a comprehensive economic development package that invests in P-12 and higher education, infrastructure and other critical services for all Missourians, strengthens Missouri’s middle class and keeps Missouri competitive in the 21st century global economy.
A Senate Committee gave approval to tax legislation this morning that, when phased-in, would put more than a $1 billion hole in the state’s budget. The bill, SB 509, reduces the top income tax rate by 1% and creates an exemption for half of a taxpayer’s business income. The bill threatens state funding for critical public services including education, health care, public safety, and social services.
The Coalition for Missouri’s Future supports policies that simplify and modernize Missouri’s tax structure, bolster the economy through tax cuts for the middle class, and preserve funding for the public investments that serve as the foundation of our state’s economy. Senate Bill 509, however, fails to meet any of these criteria. The bill is overly complex and riddled with special-interest loopholes. It disproportionately benefits the wealthy at the expense of lower-income and middle-class taxpayers. And, it jeopardizes state funding for critical public services and infrastructure including schools, health and social services, and investments in technology.