Amy Hunt is a wife, mother of three boys, and a member of Independent Women’s Network. She lives in St. Charles. Originally appeared in St. Louis Post-Dispatch.
Do you ever check out at the grocery store and look at your cart thinking, “That’s it?”
This level of unaffordability is the most pressing issue for women today. We run our households, making most of the spending decisions. Over half of homes have women as de facto CFOs of the family.
Too many families are treading water and fearful of an unexpected expense. Even with pay increases now outpacing inflation, we still have years of hardship to recoup. Women who land a better job, receive a bonus, or land a promotion will feel the sting of their merit in the form of income taxes.
That disparity hits hard. But there’s hope for Missouri families who can consider eliminating state income taxes, which would unlock hundreds of dollars of their own income to curb the strain in their budgets, giving them the ability to save, invest, or just catch up.
Missouri voters face an opportunity to boost tax relief even further for all paycheck earners and make it permanent. We could join the growing number of U.S. states also phasing out their income taxes to pursue strong economic growth and attract new residents.
Earlier this month, the Missouri House of Representatives decisively passed a proposed constitutional amendment (HJR 173) to let voters decide to eliminate the state income tax by phasing it out.
The White House Council of Economic Advisors finds that Missouri workers could see average wages rise by about $2,800 per year, creating a massive financial cushion. This could also lead to a nearly 15% increase in business startups, a recipe for a thriving economy that could outpace neighboring states.
Income tax elimination is good for both tax payers and the state’s economy.
Analysis of Tax Foundation data found that non-income tax states accounted for 25% of the economic growth of the United States between 2010 and 2019. Typically, economies of states that never taxed income grew faster than those of states who had one. Conversely, states that adopted an income tax in the last six decades — including Illinois, New Jersey, and Connecticut — experienced slower growth than the rest of the country. Even U-Haul has identified a “discernible trend” of one-way customers moving out of high-tax states to low-tax states.
Any good constituent would ask, “But how will we pay for services?”
Currently, Missouri has a virtual flat income tax with the top rate around 4.7% on income over $9,436. The income tax comprises over half (about 60%) of the state’s general operating budget. Phasing out the income tax requires a reasonable revenue replacement plan to prevent disruptions to critical government services—such as roads, schools, and social safety net programs.
The bill under consideration would do so by expanding the sales tax and use tax base to tax more services and goods purchased in Missouri. The tax repeal won’t occur all at once though. A new revenue trigger allows the state to automatically phase out the income tax over time, with full elimination expected to happen around 2031.
While an almost foreign idea to some, state income tax elimination is actually popular with over half of Missourians. Some 52% of voters prefer sales taxes to individual income taxes to raise revenue, compared to 29% who prefer income taxes to sales taxes, according to a Saint Louis University/YouGov poll in February.
It is now our state senators who will need to heed the public support for income tax elimination and consider the good outcomes other states enjoy by passing HJR 173.
Place the final decision in the hands of voters this fall and give Missouri women more freedom to decide how best to use their household’s hard-earned dollars.
