Governor Parson Issues Legislative Vetoes, Calls for Special Session for Permanent Tax Relief, Largest Tax Cut in State History
Special Session to Include Extensions for Critical Agricultural Tax Credits
(JEFFERSON CITY, MO) – During a press conference at the State Capitol, Governor Parson announced that he is vetoing HB 2090, SB 724, HB 1720, and HB 1667. In response to his vetoes of HB 2090 and HB 1720, Governor Parson is planning a special session to pass permanent tax relief for all Missouri taxpayers and to extend the sunset on key agricultural tax credits.
For those who had tax liability in 2021, HB 2090 authorized one-time $500 tax rebates for individuals making less $150,000 per year and $1,000 rebates for joint filers making less than $300,000 per year. Since the rebates on tax liability would be pro-rated due to the program being underfunded, no taxpayer would receive the advertised maximum rebate. Many working Missourians, including low-income earners, high-income earners, and vulnerable populations, were left out of this temporary relief measure entirely.
Alternatively, Governor Parson is proposing permanent tax relief for all taxpaying Missourians. As the nation and Missouri face record inflation, historically high gas prices, and rising food costs, Governor Parson wants to provide permanent tax relief that provides yearly savings to Missourians, as opposed to a one-time stimulus.
"I have always advocated for reducing Missourians' tax burden and support the spirit of this legislation, however, the reality is, we can do better for all Missouri taxpayers than HB2090, and I want to focus on a comprehensive and permanent tax reform package," Governor Parson said.
"We have managed our state resources responsibly and our consistent investment in workforce development and infrastructure is providing a strong foundation for Missouri. Now is the time to take additional steps to help alleviate the strain on Missouri families. Permanent tax cuts that provide real relief to families, senior citizens, the working class, and small businesses every year is a better answer to the inflationary pressures we face, and we look forward to getting it done," Governor Parson said.
Tenants of Governor Parson's proposed tax plan include reducing the individual income tax rate, increasing deductions and allowances for taxpayers, and further simplifying the tax code.
HB 1720 established several new agricultural tax credit programs and re-authorized existing ones, however, the sunsets on the tax credits were only extended for two years.
"These two-year extensions are problematic and reduce the benefit to Missouri farmers and business owners," Governor Parson said. "Applicants often need a minimum of 24 months in order to secure the equity and private investment needed for projects. When a program is only guaranteed for a partial period of a projects development, businesses are less likely to invest."
"This year the General Assembly authorized longer sunsets for a number of other tax credit programs, and as agriculture is Missouri's top economic driver, it's only right that we offer Missouri farm families - the foundation of our economy - with the same opportunities as others. We must extend these key agriculture tax credits for a minimum of six years," Governor Parson continued.
Governor Parson's special session plan for agriculture tax credits and related priorities includes:
Extending the sunset on agriculture tax credits included in HB 1720 for a minimum of six years rather than two;
Exempting certain agricultural equipment from state and local sales tax; and
Modifying the Family Farms Act to increase the number of small farmers that qualify for the program, and increasing the amount of loans available to the farmer.
“We support the Governor’s call to fully extend these agricultural tax credits that are critical for our state’s agriculture industry, ensuring it maintains pace with competing industries and the needs of Missourians,” said Senator Jason Bean and Representative Brad Pollitt. “The goal has always been to provide longer extensions for these tax credits. Last session began with an Ag bill that extended these credits for six years but ended with support for two years. While it was certainly our priority to address this in next year’s session, we respect the Governor for calling us back to finish the job and support Missouri’s number one industry. The important issues in this bill have not changed, and we remain committed to working to address the needs of agricultural communities across the state.”
Both permanent tax relief and agriculture tax credits subjects will be addressed during a special session later this year. Governor Parson is currently working with legislative leaders to identify a date for the special session call.
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