On Tuesday, the members of the legislature were asked to vote on a resolution that could eliminate state income tax and replace the current revenue source with a new sales tax.  It is the re-telling of the proverbial story of robbing Peter to pay Paul.

My vote for the passage of the resolution in the legislature only did one thing. It placed the burden of decision-making firming the lap of the Missouri voters.  In November, Missouri voters will have to decide whether or not it is better for the future of the State of Missouri to eliminate income tax in favor of higher sales taxes. There will be good arguments on both sides, convincing arguments to cause you to vote yes or no.

Some will say the stigma of income tax in Missouri has impeded economic growth. There are multiple examples and comparisons to defend that position.  Others will argue that the sales tax burden will be shifted to those that can least afford it.

The resolution does not define who pays the sales tax or how much they pay. The resolution, if passed by the voters in November, will give the Missouri legislators time to craft a new taxing system in Missouri in serving the best interest of future generations of Missourians.  It may be true our system of taxation in Missouri is outdated and if we started over it would not look like the system, we have now. But will the legislators make it better or worse?

The foundation of this argument is both philosophical and economical.  Is a consumptive tax (sales tax) better than a production tax (income tax)?  Essentially, production represents supply, while consumption represents demand, forming the core of the economic cycle.

This legislator favors a consumptive tax only when it cast a broad net to include as many taxpayers as possible.  I do not favor exceptions, exemptions, or exclusions.  Other legislators may try to find loopholes to favor certain special interest groups. When a few don’t pay, the remaining will pay more.  If there was ever a reason to vote in November this could be it.  Re-structuring our tax code will be transformative.  If the resolution passes in November, there could be a whole new list of winners and losers.  Will it be Peter or Paul?

Please contact my office with questions or concerns. My email is Bruce.Sassmann@house.mo.gov or you can call my legislation assistant, Jill Ryals, at 573-751-6668.