JEFFERSON CITY, Mo – On October 5, Governor Mike Parson signed SBs 3 & 5 and HB 3 into law. Both pieces of legislation are a result of the special session Governor Parson called to pass historic income tax cuts and extend key agriculture tax credits for a minimum of six years.
“Missouri’s elected officials have been hard at work at the State Capitol to pass critical support for farmers and ranchers and the largest income tax cut in state history for all taxpaying Missourians,” Governor Parson said. “This summer, we engaged stakeholders, representatives, and senators. We went to them, met them where they were, and formulated a concrete path ahead. Today, on the successful conclusion of our special session, we are proud to sign two historical pieces of legislation into law.”
SBs 3 & 5 reduces Missourians’ income tax liability by making several changes to income tax laws in the state of Missouri, including:
- Reducing the top individual income tax rate from 5.2 to 4.95 percent, resulting in the majority of taxpaying Missourians seeing an approximately five percent decrease in their tax liability;
- Eliminating the bottom income tax bracket, allowing Missourians to earn their first $1000 tax free;
- Allowing an additional .15 percent top income tax rate reduction to 4.8 percent when net general revenues increase by $175 million;
- Eliminating income taxes for individuals making less than $13,000 a year and couples making less than $26,000; and
- Allowing three additional .1 percent top income tax rate reductions in future years when net general revenue increases by $200 million, adjusted for inflation.
Due to additional rate reductions and revenue triggers, once fully realized, SBs 3 & 5 will reduce the top income tax rate in Missouri to 4.5 percent. For more information on SBs 3 & 5, click here.
“Every Missourian can support sending less of their money to the government, and we trust Missourians to make decisions with their own money,” Governor Parson said. “Throughout my career, I’ve committed to exploring every opportunity to reduce Missourians’ tax burden, and thanks to our strong financial position and balanced approach, the time is now. This historic tax cut means more money for Missourians to spend, invest, and save. It means economic growth, business expansions, and good-paying jobs for Missourians both today and tomorrow.”
Governor Parson also signed HB 3 into law, which includes the extension and creation of several agriculture tax credit programs intended to help develop key areas of Missouri’s agricultural industry, the state’s top economic driver. The sunset for each program is for a minimum of six years. HB 3 includes:
- Extending the expiration of the meat processing facility investment tax credit;
- Creating a tax credit program for Missouri retail dealers of higher ethanol blend fuels;
- Creating a tax credit program for Missouri retail dealers of biodiesel;
- Creating a tax credit program for Missouri biodiesel producers;
- Creating a tax credit program for establishing or improving urban farming operations;
- Extending the expiration of the Rolling Stock Tax Credit program;
- Extending the expiration of the Agricultural Product Utilization Contributor Tax Credit;
- Extending the expiration of the New Generation Cooperative Incentive Tax Credit;
- Extending the Wood Energy Tax Credit program;
- Exempting utility vehicles for agriculture use from state and local sales and use taxes;
- Creating the Specialty Agricultural Crops Act; and
- Amending the Family Farms Act to modify the definition of small farmer.
“These wins will help further develop Missouri’s agriculture industry, create opportunities for farmers, ranchers, and ag-businesses, and help ensure Missouri agriculture remains not only our state’s top economic driver but that its spirit and tradition continues to live on in the next generations,” Governor Parson said. “We thank all of Missouri’s agriculture groups for their trust in us to get this done. We appreciate their leadership and commitment in securing a better deal for Missouri’s farm and ranch families.”
For more information on HB 3, click here.