Senator-elect pushes to make tax holiday annual, mandatory

JEFFERSON CITY, Mo. -- A Southeast Missouri lawmaker wants to make the sales tax holiday the state held last August an annual event and proposes eliminating a provision that gave local governments the option of not participating.

State senator-elect Jason Crowell, R-Cape Girardeau, prefiled a tax holiday bill for consideration in the coming legislative session. Crowell said the holiday held this year as an experiment proved successful and popular.

The one-time holiday was created under legislation sponsored two years ago by Crowell's predecessor, departing Senate President Pro Tem Peter Kinder, R-Cape Girardeau. Under that law, sales taxes were waived for three days in August on purchases of clothing, computers and school supplies.

Opting out

To alleviate the concerns of local officials worried about losing needed tax revenue, however, cities and counties were allowed to opt out of participating. As a result, shoppers in some areas were able to make tax-free purchases while others still had to pay local sales taxes, although the state's 4.225 percent sales tax was waived throughout Missouri.

According to the state Department of Revenue, 179 of 571 Missouri cities and 66 of 114 counties invoked the opt-out provision. Crowell, the outgoing House majority floor leader, said the holiday should be uniformly applied in the future.

"We should allow every Missourian to get the benefit regardless of where they live," Crowell said.

Crowell's proposal to make participation mandatory is likely to meet resistance from local governments and the groups that represent them.

Missouri Municipal League executive director Gary Markenson said the current law put some cities in the uncomfortable position of opting out of the holiday in order to avoid busting their budgets.

"The legislature got to play Santa Claus, and cities and counties had to be the Grinches who stole Christmas," Markenson said.

Missouri Association of Counties executive director Dick Burke, like Markenson, said his organization could live with the holiday if local officials could choose to opt in rather than being forced to take the unpopular step of opting out if they determined lost revenue couldn't be spared.

No holiday, no pay raise

Crowell said county officials in particular are asking lawmakers to authorize increases in their salaries. If they can afford pay increases, Crowell said, they can afford to give their constituents a three-day tax break.

"I can guarantee their pay increase proposals will go nowhere if the sales tax holiday goes nowhere," Crowell said.

Markenson said it isn't fair for the legislature to strip local governments of revenue approved by local voters.

"Our police and firefighters can't take a sales tax holiday," Markenson said. "They still have to be there, and we still have to pay them."

Department of Revenue spokeswoman Jessica Robinson said estimates on the economic impact of this year's tax holiday are being calculated but haven't been finalized.

Tax holiday supporters say lost revenue is recouped by the additional economic activity created by the holiday and increases in purchases on nonexempt items.

The bill is SB 47.

mpowers@semissourian.com

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