I couldn’t help but notice while I was taking some time off the creation of another group opposing giving Missourian’s control over their taxation. They sounded authoritative, almost like they knew something the rest of us don’t know about tax reform.

Hoping to learn something, I read their missives, er, I mean their press release and interviews only to find it to be deja vu all over again! Sadly, it was nothing more than the same deceptive narrative we have seen in the past.

The members of this new coalition are by and large the same, big government crowd who know how to work the existing system and don’t want anybody messing with their rice bowl. I’ve done battle with many of them before and no matter how many times you expose them, they keep coming back. They are using the same tactics of distorting and outright tell lies about the measure as a previously announced group.  It’s probably because they are using some of the same political “consultants” as the other totally misnamed group.

The new group and others tell so many falsehoods that it’s hard to choose which ones to address first.  It’s probably best to start with the foundation of whether the proposal will provide adequate revenue to provide state services. On one hand the new group calls the proposal the “tax everything” tax and then says it won’t generate enough revenue.  If it indeed taxes everything then one would have to accept the fact that it would generate more than enough revenue.

The group claims that the Missouri Taxpayer Relief Act would have to replace at least $7.9 billion.  That’s patently false.  It’s so false that any other claim made by the group should automatically be dismissed as unreliable.  After all, if you can’t even get the most basic element right, how can you be trusted to get anything right?  Here’s the facts.

The base of the discussion is the Fiscal Year (FY) 2010 General Revenue collections from the state Office of Administration.  The opponents use state FY2011 numbers but the Bureau of Economic Analysis data is not yet available for FY2011 so using FY2010 at this time is the most accurate with documentation sources available.

Here is what the opponents say needs to be replaced (FY2011 numbers):

Individual Income Tax $4.8b
3% Sales Tax $1.8b Senior Citizen Circuit Breaker $0.1b 1% Prop C Sales Tax $0.7b Tax Credits Already Issued/Earned $0.4b Total To Be Replaced $7.9b

The problem is, the only part that needs to be replaced is the individual income tax portion.

  • The current sales taxes are not being replaced, they will still be collected over a broader base
  • The Senior Circuit Breaker is paid out from the individual income tax collections and are part of it’s replacement
  • Prop C (Education sales tax) is not being replaced but will still be collected over a broader base
  • Majority of tax credits are corporate and will be unaffected by measure. Individual tax credits can be redeemed through 2016. No replacement necessary.
This graphics shows what is really being replaced – only the individual income tax collections.
The false revenue shortfalls the opponents calculate ignore the expanded base. The current sales tax base will be nearly doubled:This following graphic shows how the individual income tax amount will be replaced.

As you can see, the expanded base plus the existing sales taxes and other general revenue sources would have generated in excess of $7.5 billion, more than the actual FY2010 General Revenue collections. From this amount, the Prop C, Parks and Soils and Conservation would be supplied.

The new group and others apparently believe that if you repeat distortions or falsehoods enough, people will believe them. From their list of supporters, that may be true for some.

We will be pointing out other distortions and untruths in the coming days and weeks.