For Immediate Release: May 20, 2022
Contact: Traci Gleason, Missouri Budget Project
Current Proposal Leaves Out Missourians Struggling to Make Ends Meet
AARP Missouri and Missouri Budget Project encourage Governor Parson to veto the flawed tax rebate proposal that was rushed through the General Assembly in the closing days of legislative session. The ill-conceived rebate included in House Bill 2090 would leave out the Missourians who are struggling most to make ends meet in face of rising costs for food, gas, and other necessities.
“Many older adults on fixed retirement or Social Security incomes don’t owe Missouri income taxes, but they pay plenty of other taxes, like sales and gas tax,” said Jay Hardenbrook, Advocacy Director for AARP Missouri. “Folks with limited incomes are already feeling the pressure of increased costs for their basic necessities, and as those costs rise, so do the sales taxes they pay. Yet they are left out of this flawed economic relief.”
According to a new analysis, 36% of Missouri taxpayers – including older Missourians living on fixed incomes, low wage families with children, and those most impacted by the health and economic consequences of the pandemic – won’t see a dime of economic relief from the proposal.
Moreover, those Missourians who are eligible for a rebate will likely be disappointed to see rebates far below the widely publicized $500 for individuals and $1000 for married couples.
- Only 60% of taxpayers in the bottom 80 percent of earners (up to $110,000) will see a tax cut at all.
- The rebates will be far less than what Missourians expect – for those earning between $66,000 and $110,000 a year, the estimated rebate will be $280.
“Whether through sales, property, gas taxes or other fees, all Missourians contribute to our state’s budget, yet lawmakers chose to leave out the Missourians most struggling in today’s economy,” said Amy Blouin, President & CEO of the Missouri Budget Project. “We urge Governor Parson to right this wrong by vetoing House Bill 2090.”
The taxpayers who are completely left out of the proposal do not have income tax liability because of the progressive nature of Missouri’s income tax structure. However, the overall state tax structure is regressive – meaning the lower your earnings, the more you pay in state and local taxes as a share of what you make.
According to the most recent analysis, Missouri families in the bottom quintile of income pay 9.9% of their income in state and local taxes, compared to just 6.2% for the wealthiest 1% of families.
“Older adults shouldn’t be left out of a tax rebate when they’re struggling to put food on the table and pay for essential medications, and neither should their kids or grandchildren,” said Hardenbrook. “We should either make sure the Missourians who need it most are included, or instead use the funds to strengthen state services for all of us.”
Missouri Budget Project is a nonprofit public policy analysis organization
that analyzes state budget, tax, and economic issues.