Corporate tax break bill may have hit wall

JEFFERSON CITY, Mo. -- A bill tightening a law that lets some multistate companies reduce their Missouri income taxes remained stuck in a committee with less than 48 hours left in the legislative session.

"Nobody seems to want to do anything," Sen. John Cauthorn, who chairs the Government Accountability and Fiscal Oversight Committee, said Wednesday.

The measure targets businesses that establish parent corporations in states like Delaware, which does not tax corporate income, and then funnel their Missouri earnings there in the form of royalties and interest.

Under the bill, such royalty and interest payments would be taxable in Missouri if the out-of-state corporation were created for the "primary purpose" of avoiding state taxes.

Senators last week amended the bill's language on determining a corporation's intent, then referred the measure to Cauthorn's committee for review of its potential costs.

Cauthorn, R-Mexico, said no member of the committee had made a motion to send the bill back to the Senate floor.

Members of Metropolitan Congregations United, an association of about 70 St. Louis area churches, watched with disappointment as committee members declined to bring the bill up for a vote. They criticized business groups for opposing the revised measure.

Although the bill was estimated to be worth several million dollars in new revenue for the state, "it's the symbolism of holding businesses responsible for paying their fair share" that's most important, said the Rev. Emery Washington, a retired Episcopal pastor.

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Corporate tax bill is HB969.

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Missouri Legislature: http://www.moga.state.mo.us