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OpinionJuly 30, 2002

During the mid-1990s, Missouri voters overwhelmingly gave approval to an amendment to the states' constitution limiting the amount of tax and fee increases that lawmakers can impose annually. This amendment is part of the reason that a $483 million increase in the state sales and fuel taxes -- Proposition B -- is on the ballot for voter approval at the August primary next week...

During the mid-1990s, Missouri voters overwhelmingly gave approval to an amendment to the states' constitution limiting the amount of tax and fee increases that lawmakers can impose annually.

This amendment is part of the reason that a $483 million increase in the state sales and fuel taxes -- Proposition B -- is on the ballot for voter approval at the August primary next week.

That figure is so far above the annual constitutional limit -- originally set at $50 million -- and clearly would have triggered a statewide vote, even if lawmakers had tried to circumvent it, which they didn't.

An unofficial calculation by The Associated Press last week shows that lawmakers approved around $71 million in higher taxes and fees during the 2002 session, including a new tax on pharmacies and higher fees for vehicle and driver's licenses.

Still, as with many things governmental, it isn't a simple matter getting an exact fix on the constitutionally mandated limit. What, exactly, is that limit?

Brian Long, budget director for Gov. Bob Holden's administration, said: "It's a calculation that has never needed to be performed, because no one has suggested we've come close to violating or exceeding it."

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The amendment allows the tax cap to be adjusted annually by the percentage change in personal income. Accounting for such inflation, Long's office determined that the $50 million cap from six years ago equals about $70 million today.

But the calculation challenge continues. The amendment allows revenue from new taxes and fees to be offset by "all contemporaneously occurring tax or fee reductions in that same fiscal year."

President Bush's tax cut, for example, allowed businesses to claim income-tax write-offs faster, resulting in $58 million less state revenue, because the state tax code is linked to the federal one.

State tax revenue was estimated to fall another $29 million because lawmakers last fall acted to exempt from state income taxes a one-time batch of federal income-tax checks.

So the limit's exact amount isn't clear. Any citizen can file suit to determine what it is. So far, no Missouri taxpayer has seen fit to do so.

Missouri's scheme of tax limitation is one of the best in the nation. But it isn't simple.

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