State Sen. Will Kraus, R-Lee’s Summit, has once again filed a proposal that would phase in a 50 percent deduction for business income reported on individual income tax returns over five years. It also would gradually cut the state’s top individual income tax rate of 6 percent to 5 percent over a decade, with each year’s reduction taking place only if yearly state revenue grows by at least $100 million.
The legislation would also increase an existing $2,100 personal deduction on income taxes by $1,000 for individuals who earn less than $20,000 of adjusted gross income.
Kraus estimates that the annual cost of his bill would be more than $1 billion when fully implemented.
Supporters warn of an exodus of businesses out of Missouri if lawmakers do nothing. The state’s economy will suffer, they argue, without tax relief.