Proposes a constitutional amendment relating to taxation

SECOND REGULAR SESSION
HOUSE JOINT
RESOLUTION NO. 174
103RD GENERAL ASSEMBL Y
INTRODUCED BY REPRESENT A TIVE P A TTERSON.
6852H.01I JOSEPH ENGLER, Chief Clerk
JOINT RESOLUTION
Submitting to the qualified voters of Missouri an amendment repealing Sections 4(d) and 26
of Article X of the Constitution of Missouri, and adopting two new sections in lieu
thereof relating to taxation.
Be it r esolved by the House of Repr esentatives, the Senate concurring ther ein:
That at the next general election to be held in the state of Missouri, on T uesday next
2 following the first Monday in November , 2026, or at a special election to be called by the
3 governor for that purpose, there is hereby submitted to the qualified voters of this state, for
4 adoption or rejection, the following amendment to Article X of the Constitution of the state of
5 Missouri:
Section A. Sections 4(d) and 26, Article X, Constitution of Missouri, are repealed and
2 two new sections adopted in lieu thereof, to be known as Sections 4(d) and 26, to read as
3 follows:
Section 4(d). 1. In enacting any law imposing a tax on or measured by income, the
2 general assembly may define income by reference to provisions of the laws of the United
3 States as they may be or become ef fective at any time or from time to time, whether
4 retrospective or prospective in their operation. The general assembly shall in any such law set
5 the rate or rates of such tax. The general assembly may in so defining income make
6 exceptions, additions, or modifications to any provisions of the laws of the United States so
7 referred to and for retrospective exceptions or modifications to those provisions which are
8 retrospective.
EXPLANA TION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is
intended to be omitted from the law . Matter in bold-face type in the above bill is proposed language.
9 2. Notwithstanding any provi sion of this Constitution to the contrary , if all
10 r evenue triggers established by the general assembly for the redu ction and elimination
11 of the curr ent state individual income tax are fully met such that the top individual
12 income tax rate is r educed, by statute, below one and four -tenths perce nt, for any tax
13 year beginning on or after January 1, 2031, or a later date on which such reven ue
14 triggers cause such rate to fall below one and four -tenths per cent, no individual income
15 tax shall be enacted or imposed by the state of Missouri. This subsection shall not
16 extinguish or affect the collectability of any individual income tax liabilities or debts for
17 any tax year beginning before the elimination of the individual income tax. This
18 subsection does not apply to an earnings tax or similar tax imposed by a political
19 subdivision of the state. This subsection does not apply to an income tax on the income
20 of trusts, estates, fiduciaries ther eof, corporations, partnerships, limited liability
21 companies, or any entities, however organized, other than individual people.
Section 26. 1. In order to prohibit an increase in the tax burden on the citizens of
2 Missouri, state and local sales and use taxes (or any similar transaction-based tax) shall not be
3 expanded to impose taxes on any service or transaction that was not subject to sales, use or
4 similar transaction-based tax on January 1, 2015.
5 2. Notwithstanding any pr ovision of this Constitution to the contrary , including
6 the for egoing, for the purpose of red ucing and eliminating the state individual income
7 tax, state and local sales and use taxes or any similar transaction-based tax may be
8 expanded by legislation to impose taxes on transactions involving any goods and
9 services. Upon the enactment of any adjustment to the sales and use tax base, all sales
10 and use taxes imposed by counties or other political subdivisions and all other sales and
11 use taxes imposed by this Constitution shall be imposed on the tax base authorized
12 pursuant to this section. For the purposes of this section, the phrase "for the purpose of
13 r educing and eliminating the state individual income tax", with res pect to legislation,
14 means that the legislation expr essly states the general assembly’ s finding that such
15 legislation is anticipated, dir ectly or indirectl y , to lead to the redu ction and elimination
16 of the state individual income tax.
17 3. Notwithstanding any pr ovision of this Constitution to the contrary , beginning
18 July 1, 2029, any political subdivision that imposes a sales and use tax shall, in the
19 manner provi ded by law , annually adjust one or mor e of the following in order to red uce
20 the amount of revenu e generated ther eby in an amount substantially equal to the
21 additional revenu e pr oduced by any sales and use tax base expansion authorized by this
22 section:
23 (1) The rate of such sales or use tax;
24 (2) The levy for any personal prop erty tax;
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25 (3) The levy for r esidential real pro perty tax; or
26 (4) The rate of any tax imposed on earnings.
27
28 Under no cir cumstances shall any county or other political subdivision make an
29 adjustment under this subsection to r esult in any red uction in funding to the public
30 schools within, or serving, such county or other political subdivision.
31 4. Beginning July 1, 2029, each sales and use tax rate imposed directly by this
32 Constitution, with the exception of the rate imposed under Article XIV of this
33 Constitution, shall, in the manner pr ovided by law , be adjusted in order to prod uce
34 substantially the same amount of rev enue as the median annual rev enue of such tax
35 pr oduced for the thr ee state fiscal years ending prior to the immediately pr eceding
36 calendar year , after the r evenues for such state fiscal years ar e adjusted for inflation. By
37 July 1, 2028, the state auditor shall be res ponsible for determining this reas onable
38 estimate and calculating the red uced rates that will go into effect on January 1, 2029.
39 5. Notwithstanding any pr ovision of this Constitution to the contrary , any tax or
40 r evenue increa se res ulting fro m legislation enacted for the purpose of redu cing and
41 eliminating the state individual income tax, if such legislation is also enacted within
42 thr ee years of the effective date of this amendment, shall be exempt fr om the
43 r equir ements of and shall not be consider ed new annual r evenue for purposes of
44 Sections 18 and 18(e) of this Article, and shall be exempt fr om the requ irem ents of
45 Article IV , Sections 30(a), 30(b), 30(c), and 30(d) of this Constitution.
46 6. The director of r evenue is her eby authorized to pr omulgate r egulations for the
47 purpose of clarifying and pro hibiting the circu mvention of the sales and use tax
48 expansion authorized by this section, as well as to define any terms otherwise undefined
49 in statute, pertaining to the sales and use tax expansion authorized by this section,
50 notwithstanding any provi sion of this Constitution to the contrary .
Section B. Pursuant to chapter 1 16, and other applicable constitutional provisions and
2 laws of this state allowing the general assembly to adopt ballot language for the submission of
3 this joint resolution to the voters of this state, the of ficial summary statement of this
4 resolution shall be as follows:
5 "Shall the Missouri Constitution be amended to prevent the imposition of state
6 individual income tax beginning in 2031, provided that revenue growth triggers are satisfied,
7 to reduce constitutionally imposed sales and use tax rates, to reduce local sales and use tax
8 rates, to reduce real property tax levies or earnings tax rates, and to authorize the expansion of
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9 the sales and use tax base for the purpose of reducing and eliminating the state individual
10 income tax?".
✔
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