Business relocation tax break on hold in House

JEFFERSON CITY, Mo. -- Missouri House members passed a variety of new tax breaks Thursday but held off on one awarding incentives to businesses that relocate to Missouri because it may have been drafted more broadly than intended.

The proposed new tax breaks could aid computer data centers, international air cargo exporters and investors in high-tech new businesses. All of those initiatives have stalled in past years because, like this year, they are paired with a reduction in tax credits for developers of low-income housing and historic buildings.

The House's 96-54 vote sends the tax credit package to the Senate, where its prospects are uncertain. Some Republican senators oppose the new tax credits while some Democratic senators oppose efforts to curtail the current tax breaks for developers.

The House also had been scheduled to vote Thursday on legislation authorizing up to $10 million of tax credits annually for businesses that relocate to Missouri. The bill had received initial approval a day earlier on a voice vote.

But sponsoring Rep. John McCaherty, R-High Ridge, put the bill on hold Thursday after The Associated Press raised questions about whether the bill was written more broadly than McCaherty intended.

During debate, McCaherty had said the bill would provide tax breaks to encourage businesses that had left the state to return to Missouri. But the bill's wording appears to authorize a tax break for any business that moves to Missouri.

McCaherty said he plans to ask the House next week to reconsider its vote of preliminary approval and reopen the legislation for amendments that would clarify its wording.

The House is considering the new relocation tax credits even though it previously passed legislation this year that would bar businesses in the Kansas City area from receiving tax breaks to move from the Kansas side of the metropolitan area to the Missouri side. The proposed truce in Kansas City-area business tax breaks would take effect only if the Kansas Legislature or governor were to enact a similar measure.

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