Campaign continues over tax legislation

JEFFERSON CITY, Mo. -- Politicking over tax-cutting legislation has been gaining steam as Missouri lawmakers prepare to return to the state Capitol in four weeks for a possible deciding vote.

Republican House Speaker Tim Jones rallied support this week for an effort to override the veto of the bill while Democratic Gov. Jay Nixon on Wednesday continued a summer campaign of defending it. Debate over the tax cut has prompted TV ads and appearances by officials outside Jefferson City.

Jones said reducing taxes for job-creators and families boosts the economy and that the legislation uses a modest, cautious approach. Speaking at a GOP office in Fulton, Mo., on Tuesday, Jones said other states are lowering taxes and that inaction puts services at risk.

"We've got a governor, an executive, who is not leading by our example, and he's vetoing these measures, which is causing us to remain in neutral," Jones said.

On the other hand, Nixon said in Bolivar, Mo., the tax measure could lead to a $200 million tax increase on prescription medications because of an apparent technical mistake. The argument has been part of the governor's pitch for sustaining the veto, along with concerns it would jeopardize funding for vital government services. In late June, Nixon announced the freezing of $400 million for state services, education and repairs because of concerns his veto could be overridden.

It "must not be allowed to become law," Nixon said Wednesday. "That's why I am strongly urging the General Assembly to think twice about voting again to raise taxes on seniors and families."

Tax cuts

Under the legislation, tax rates for individuals and corporations would be reduced and a new deduction for business income reported on individual tax returns would be created. The corporate and individual tax rate cuts would take effect only if state revenue grows. Legislative projections estimated the measure would reduce state revenue by more than $700 million annually after it is fully implemented. Nixon contends the annual cost would be higher and as much as $1.2 billion in the short term, based upon other provisions in the legislation.

The tax cut was a priority for the Republican-led Legislature and would be the first income tax rate reduction in Missouri since 1921.

House Republicans are to begin meeting today for several days to discuss possible veto overrides. Legislators return to the Capitol on Sept. 11, and a successful override would require the vote of every Republican House member or support from some of Nixon's fellow Democrats. The legislation was several votes short of a two-thirds majority when it passed this spring.

Jones said this week he sees "the momentum on our side, and I think this is something that Missourians want us to vote on." He predicted a strong local push as the veto session nears.

"This is a very simple bill to vote on," he said. "You either favor putting more money back in the pockets of taxpayers or you're with Gov. Nixon. I don't know many members -- if any members -- of my caucus that would stand with Gov. Nixon ultimately on any important, pivotal issue. This is one of those decisive issues."

In addition Wednesday, a coalition that supports the tax cut announced Texas Gov. Rick Perry planned to come to Missouri and would finish a day of meetings by talking about how tax policies have helped his state. The group Grow Missouri said Perry was to speak Aug. 29 in Chesterfield, Mo.

Jones also requested a legal opinion from Attorney General Chris Koster about whether Missouri's legislation would let taxpayers claim a retroactive refund for the previous three years as has been stated by Nixon's administration. State law allows legal opinion requests from the Legislature and various officials. A spokeswoman for Koster declined to comment on Jones' request.