Why Missouri voters get the final say on the governor’s tax plan

JEFERSON CITY, Mo. (KY3) -Missouri lawmakers are advancing the governor’s plan to eliminate income taxes, but voters will get the final say.

To eliminate the state income tax, lawmakers have to find a way to make up $300 billion in state revenue from new taxes. Because of an 1980 addition to the state constitution called the Hancock Amendment, lawmakers have to seek voter approval for any new taxes. The proposal asks voters if they want to temporarily suspend that rule.

The Hancock Amendment was added to the Missouri Constitution in 1980. It says new taxes and increases need voter approval if the legislature wants to raise taxes by more than 1% of existing revenue, explains SLU Assistant Political Professor Steve Rogers.

“We’re basically saying to the legislature, for the next five years, they can adjust our taxes more than this 1% without having to go to the voters for approval,” Rogers said. “So overall, this amendment that we’re talking about for this fall is going to basically give us an exception to the Hancock Amendment.”

The tax reform proposal was approved by the Missouri Senate this week. It needs one more round of approval from the Missouri House to get on the ballot.

If it’s put on the ballot, the question will read:

“Shall the Missouri Constitution be amended to:

● Phase out the individual income tax based on revenue growth;

● Reduce personal property and other local taxes when local revenues increase;

● Modify the sales and use tax to eliminate income tax and reduce local taxes; and

● Protect local funding for public schools and other purposes?"

Republican Floor Leader Sen. Tony Luetkemeyer said Missouri needs tax reform to compete with other states.

“Missouri needs tax reform to retain and attract small businesses, to keep families here in Missouri, and to grow our economy,” Luetkemeyer said. “Eliminating the state income tax represents the largest middle-class tax cut in the state’s history.”

Democratic Minority Leader Rep. Ashley Aune said she hopes voters will not approve the measure.

“If the Republicans simply wanted to lower income tax or remove income tax for Missourians, they could just do that by statute,” Aune said. “They could pass a bill, do that without voter approval. They’re asking for voter approval because they absolutely intend on raising our taxes.”

Rogers said if the amendment gets voted down, lawmakers would still be able to implement some new sales taxes, but would need to go to voter approval for most of the taxes they would want to raise.

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