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Vehicle sales and a special session: What’s going on?


JEFFERSON CITY, Mo. — Lawmakers will reconvene in the capital city in September to take up a complicated issue regarding vehicle sales and tax benefits during a special session — a move that could be particularly beneficial to Missouri farmers. 

Gov. Mike Parson called legislators back to Jefferson City the week of Sept. 9 for a special session to run concurrently with veto session. Lawmakers have been asked to “clarify an area of state law that has been historically unclear to the citizens of Missouri,” said Department of Revenue Acting Director Ken Zellers. 

So what’s going on with the vehicle sales issue? 

At issue is state statute regarding the trade in of a vehicle — including cars, boats, or motors — and whether Missourians could credit proceeds of multiple vehicles sold against the purchase of a new one.  

The Missouri Supreme Court ruled in June that the statute “unambiguously permits the sale proceeds of only one vehicle to reduce the purchase price of a newly purchased vehicle for the purposes of calculating sales tax.” This meant the court interpreted the statute to be a “one-for-one” sort of deal when trading in a vehicle for another and using that credit to offset some of the cost. 

“After reviewing the Court’s decision, we’ve decided to call a special session because it’s simply the right thing to do for the people of our state,” Parson said. “The enforcement of this decision would create a financial burden on Missouri taxpayers and unnecessary government red tape that we can proactively prevent.” 

Who does this impact? 

Before the ruling, Missourians were able to credit the proceeds of vehicles sold within a 100-day window against the purchase of a new vehicle in computing sales tax.

The benefit was especially helpful to farmers in rural Missouri. 

Before the Missouri Supreme Court ruling, individuals could trade in multiple vehicles to purchase a new truck that cost thousands of dollars but was needed for a farm, for example. The money saved from the tax benefits could then be reinvested in the farming operation, Anne Marie Moy, director of strategy and communications for the Department of Revenue (DOR), told The Missouri Times when asked about the tax impact on rural Missourians. 

“Maybe it’s added acreage; maybe it’s a new steer or a bull to inject new blood into his herd; or maybe it’s been a tough year and that money is simply going to help that farmer put food on the table and make ends meet,” Moy said. “Whatever the case, it’s real money that will make a difference for that farmer and his family.” 

About 140,000 trade-in transactions occur across the state in a year and about 6 to 10 percent involve multiple trade-ins, according to DOR statistics. 

Are lawmakers on board with this topic? 

Democrats immediately decried the announcement of the special session over the vehicle sales issue. Instead, many want to come back to Jefferson City to address other issues, such as the steep decline of children on Medicaid or recent gun violence that has wreaked havoc in St. Louis particularly. 

But some Republicans, too, would like to see the special session broadened. 

Sen. Bob Onder, a member of the Conservative Caucus, said he wished lawmakers would be given the opportunity to take up Clean Missouri redistricting as well. 

“I certainly think we don’t want anyone to be paying any more taxes than they owe, and if there’s a court decision that reverses longstanding tax policy in Missouri, then I have no problem going into session to fix that,” Onder told The Missouri Times. “But I think a very big piece of unfinished business from last session was the legislature’s failure to submit to the voters an opportunity to fix the Clean Missouri initiative from last year.” 

Specifically, Onder contends voters didn’t have an accurate grasp on the redistricting portion of Clean Missouri and is asking Parson to expand the scope of the special session to allow for debate on the topic. 

“There’s always the opportunity to talk about any subject matter during the session, but usually the subject matter of a special session is limited to the call of the special session,” Onder said. “As the all is written right now, it doesn’t include a Clean Missouri fix. … The governor could broaden or amend his call.” 

What is the compensation for lawmakers during the special session? 

Members will receive $119.20 per diem. As the schedule stands now, the attendance of the full body is only required on Sept. 11, said Dana Rademan Miller, chief clerk of the House. 

Members are only able to forego the per diem on days the House holds technical sessions when a roll call is not taken. 

Bill handlers during the special session will be Sen. Wayne Wallingford and Rep. Becky Ruth. Both are Republicans.