Governor Nixon criticizes flat tax proposal
JEFFERSON CITY — Missouri Gov. Jay Nixon talked taxes, storm response and the state’s economy during remarks Thursday at the Governor’s Mansion to members of the press.
Nixon, speaking before reporters from across the state during the annual Missouri Press Association’s “Day at the Capitol,” expressed strong doubts about legislative and ballot petition efforts that would eliminate the state’s income tax and replace it with a statewide sales tax.
“I don’t think raising the sales tax on Missourians is smart,” Nixon said.
The governor cited a recent analysis by economist James Moody, who served as budget director under former Republican Gov. John Ashcroft, which found statewide sales taxes would have to be as high as 15 percent in order to match income now generated through state income taxes.
Most flat tax proposals, including a number of potential ballot initiatives being floated by investor Rex Sinquefield, of St. Louis, would cap the sales tax at 7 percent.
“That is not the right way to go,” Nixon said.
The governor said such an increase would “make Missouri goods non-competitive” with goods in bordering states. He also questioned aspects of some flat tax proposals that would expand the sales tax to cover many services not currently subject to taxation.
Nixon also used his remarks as an opportunity to praise state efforts, including cooperation between the emergency management officials, the Missouri Department of Transportation, and the Missouri National Guard.
MoDOT crews were deployed through last weekend, helping 24 counties clear snow from roads buried under last week’s blizzard. Nixon said 54 counties in Missouri saw record snowfall during the storm.
Citing the need for improved job creation and economic development, Nixon also gave a hard push for the Compete Missouri initiative he proposed during his State of the State address in January.
The proposal would consolidate the state’s main business incentives and would increase funding for job training.
Nixon said while the state is still dealing with a sluggish economy, investments in training was necessary to “make sure we have a trained workforce for the jobs of tomorrow.”
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