JEFFERSON CITY, Mo. – Another gas tax alternative has emerged in the House, where Rep. Marsha Haefner’s HB 2723, which would cap what businesses can keep from sales taxes and from withholding employees’ taxes and put any revenue generated over the cap into a fund for infrastructure.
Haefner, R-St. Louis, doesn’t think raising taxes would be right solution to the state’s infrastructure issues and proposes drawing the revenue from taxes already withheld, but not collected.
“Our transportation system is facing a funding crisis and I am committed to finding a solution that does not ask Missouri families to pay more in taxes each year. By recouping these tax dollars that are already being paid, we can take a major step toward addressing our current and future transportation needs so that our roads and bridges do not crumble into total disrepair,” Haefner said.
Under current Missouri law, businesses can keep 2 percent of sales tax collected as long as they file their tax returns on time and employers can keep a percentage of taxes withheld from employees’ paychecks each pay period. Haefner’s legislation would cap what businesses could keep from each of those taxes at $1,500 and put the remainder into a new Transportation Infrastructure Fund.
Haefner says an estimated $77.5 million dollars could go to infrastructure each year through this proposal. The bulk of the funds would come from large businesses and employers, not small businesses, she said.
“If you look across the nation at other states, Missouri is an outlier as it is one of only a very few states that allows businesses to retain a portion of sales and withholding taxes with no cap on the overall amount,” she said. “In fact, 17 states do not allow any kind of tax discounts for vendors, and most others put an annual cap in place on the amount businesses can keep.”
A 5.9 cent gas tax increase passed the Senate last week and was called reasonable by House Transportation Committee Chariman Glen Kolkmeyer, R-Odessa, on last week’s #moleg podcast as the legislature looks for ways to fund Missouri’s highways and bridges.
“I’m definitely supportive of a gas tax increase,” he said. “I think 5.9 cents is reasonable. It’s going to bring in much needed money so we are able to match our federal funds coming in.”
HB 2723 was referred to the Ways and Means Committee, which will hear the legislation Tuesday upon adjournment.