JEFFERSON CITY, Mo. – State Sen. Eric Schmitt, R-Glendale, says his most recent work to cut taxes is modeled based on a life long admiration for the late Jack Kemp — a former U.S. Representative, cabinet secretary, and vice presidential nominee.
“As a kid growing up, I would watch Crossfire with my dad, and I remember him being on television and him being a happy warrior,” Schmitt said. “He believed very strongly in the Republican principle of economic growth. He was trying to reach out and convince others who may have been Democrats of his principles with a conservative message.”
Previously, Schmitt sponsored and passed the Franchise Tax Cut, which was one of the largest in state history.
“We worked very closely with Senator Schmitt on cutting taxes — especially in cutting the Franchise Tax,” Ray McCarty, president of the Associated Industries of Missouri, said. “He has also been sponsoring this corporate tax cut for three years. He has been strongly committed to cutting taxes since he arrived in the Missouri Senate.”
This year, the corporate tax cut was originally filed as Senate Bill 11. The bill would, over a five-year period, cut the corporate income tax in half. It would cut taxes on “C corps,” which are the large corporations in the state, but also cut taxes on small business owners who are traditionally organized differently and commonly referred to as flow-through entities.
“This is a real tax cut that will put money back into the pockets of business owners,” Schmitt said. “If people can save 6 or 7 percent on their state taxes, that’s a big deal. That could be the difference between expanding or adding employees.”
Opponents view the tax cuts as an unsustainable reaction to the tax cuts enacted by the state of Kansas, where they dramatically cut taxes and completely eliminated the flow through tax.
“We had this idea before Kansas, but they have added some urgency to the issue,” Schmitt added. “What people should understand is that there is a fiscal note associated with doing nothing, he said. When asked if Kansas. I don’t know, but I do know that if we do nothing to remain competitive there is a cost to that as well.”
Missouri is 48 out of 50 in state growth domestic product and has seen its population fall far behind the rest of the nation’s rate of growth — losing half of its congressional representation since World War II. When fully phased in, Schmitt said the tax cut would cut state revenue by $350 million each year.
Growing up in north St. Louis County, Schmitt said he had to be persuasive — as he was outnumbered in most political discussions.
“I was typically the only conservative in a political discussion, so you have to learn how to talk to people and convince them of your ideas,” Schmitt said. “Jack Kemp was a person who inspired me to take that conservative message outside of the Republican echo chamber and attempt to convince people why lower taxes benefit them and their families. This is not about ‘one percenters’, I didn’t grow up in that world.”
Senate Bill 11 was eventually rolled into Senate Bill 26, sponsored by Sen. Will Kraus, R-Kansas City.
House Bill 253, legislation that’s similar to SB11, passed the General Assembly and is sitting on the governor’s desk. Gov. Jay Nixon, a Democrat, has indicated he will veto the legislation.
“I believe as Jack Kemp did that cutting taxes will expand the economy,” Schmitt said. “It worked with Kennedy and Reagan. The problem has been there haven’t been the spending reductions to avoid deficits.”
“As employers are pulling Missouri out of the economic malaise, the Missouri General Assembly did its part by sending a clear signal via House Bill 253 that we will cut the cost of doing business in Missouri,” Dan Mehan, President of the Missouri Chamber of Commerce, said.
To contact Scott Faughn, email scott@themissouritimes.com, or via Twitter at @scottfaughn.
Scott Faughn is the publisher of The Missouri Times, owner of the Clayton Times in Clayton; SEMO Times in Poplar Bluff; and host of the only statewide political television show, This Week in Missouri Politics.
