Steelman proposes state tax breaks
Tuesday, May 6, 2008
JEFFERSON CITY, Mo. (AP) -- Republican gubernatorial candidate Sarah Steelman proposed a $171 million tax break Tuesday that she said would affect most Missouri taxpayers.
Steelman would cut taxes by increasing the personal and dependent child tax deductions.
She estimates it would cost $96 million to increase the personal exemption for single filers from $2,100 to $2,625 and from $4,200 to $5,250 for couples.
Increasing the exemptions from $1,200 to $2,100 for dependent children and from $1,000 to $2,100 for dependent seniors would cost $28 million.
The campaign estimates the higher child dependent exemption would save $108 a year for those with two kids and $162 for those with three.
Steelman, the current state treasurer, predicted that cutting state taxes would help the economy and thus eventually result in increased tax collections.
"I'm talking about stimulating Missouri's economy by putting money back into the taxpayers' pockets, so that they can have money to generate jobs and economic activity," she said. "The money just doesn't disappear into thin air."
All three of the main gubernatorial candidates have called for some tax relief. Earlier this week in St. Louis, Republican Kenny Hulshof called for freezing property tax assessments for senior citizens after 2008.
And earlier this year, presumptive Democratic governor candidate Jay Nixon called for increasing the maximum income limits for a state tax credit designed to help offset property taxes.
Spokesmen for Hulshof and Nixon each did not immediately return calls seeking comment about Steelman's latest proposal.
Earlier this week, Steelman also suggested phasing out a 1 percent earnings tax levied on those who work or live in St. Louis and Kansas City.
Besides announcing tax cutting plans at a news conference in her Jefferson City campaign office, Steelman said she would create an 11-member panel to suggest ways to make state taxes fairer and more efficient. The panel would include one member from each of the state's nine congressional districts, plus an economist from the state's two federal reserve banks.
Steelman didn't recommend any specific changes or areas where she wanted the panel to start. But she said there are several examples of what she called inequity, such as the way federal income taxes are deducted from state taxes.
She said many Missourians are forced to pay taxes twice on the same money -- once to Washington and once to Jefferson City.
Steelman also urged lawmakers to pass legislation that limits property tax increases and a proposed constitutional amendment barring state judges from ordering tax increases. No Missouri judge has ever done that, but proponents of the measure say it's happened in other states.
Senate President Pro Tem Michael Gibbons, R-Kirkwood, is pushing a bill that would require property tax rate reductions to offset increasing assessments.