Kinder will ask governor for session on tax holiday

JEFFERSON CITY, Mo. -- Senate President Pro Tem Peter Kinder will ask the governor to call lawmakers into special session to consider legislation that would suspend sales taxes during Thanksgiving weekend, traditionally a busy time for retailers.

However, a spokesman for Democratic Gov. Bob Holden said a special session would be contingent upon federal legislative action on a tax holiday.

Kinder, R-Cape Girardeau, said a so-called tax holiday would provide a needed economic stimulus and help boost Christmas sales, which are expected to be down this year.

"This economy is going down faster than any of us thought," Kinder said. "I'm of the opinion that urgent and extraordinary action is in order."

Kinder said he will send a letter this week to Holden requesting the special session.

Jerry Nachtigal, Holden's spokesman, said that as of Tuesday prospects were dim for a special session. Congressional passage of legislation to reimburse states for lost revenue from a sales-tax holiday would have to come first, Nachtigal said.

"Governor Holden supports a sales-tax holiday at the state level, but it is all dependent on the federal legislation and what happens there," Nachtigal said. "You really can't contemplate a special session until it is clear the bill will pass in Congress. I'm told it is a bill with very questionable prospects of passing."

U.S. Sens. Patty Murray, D-Wash., and Olympia Snowe, R-Maine, are pushing the tax-holiday measure as a stand-alone bill. But Snowe's office said Tuesday she may attempt to attach the provision as an amendment to a larger economic-stimulus package currently before the Senate. The tax-holiday component would cost the U.S. Treasury an estimated $6.5 billion depending upon how many states participated and the extent of consumer response.

Time running short

With only two weeks until Thanksgiving weekend, time would be tight for the Missouri General Assembly to act. However, Kinder predicted lawmakers could get the job done within 72 hours.

Kinder sponsored a similar bill during this year's regular legislative session. That measure, which called for a four-day tax holiday in August, won first-round Senate approval but was never brought up for a final vote in the chamber before its May adjournment.

The bill would have cost the state about $6 million in lost sales-tax revenue and reimbursement to cities and counties for their lost revenue. Considering that Thanksgiving weekend is one of the busiest shopping periods of the year, the price tag for a tax holiday at that time could be higher.

Kinder allied with Democratic state Sen. Ken Jacob of Columbia, one of his staunchest political adversaries in the Senate, in pushing the bill this year. If two men of such opposite views can agree on the issue, chances for success in the Legislature are strong, Kinder said.

However, Jacob said a special session isn't feasible unless the federal effort gains more momentum.

"From what I understand, it's all talk; just like our bill is talk," Jacob said. "I don't have any information that passage of the bill is imminent. I don't think it makes a whole lot of sense to do anything unless Congress passes its bill."

Business hardships

Jacob said it would be difficult for lawmakers to convene on such short notice. Even if they did and passed a bill, the measure would create a hardship on businesses that would have perhaps only days to reconfigure their equipment so sales taxes temporarily wouldn't be charged.

"Ideas are easy," Jacob said. "Implementing and putting them into operation is a totally different thing."

Jacob said he will again introduce a tax-holiday bill when the Legislature's regular session begins in January.

Seven states -- Florida, Texas, Pennsylvania, South Carolina, Iowa, Connecticut and Maryland -- plus the District of Columbia currently hold sales-tax holidays at some point each year.

The General Assembly already held one special session this year. Lawmakers met from Sept. 5 through 15 and successfully passed a prescription drug program for the elderly, changes in livestock pricing laws and a minor income-tax break.

mpowers@semissourian.com

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