Lawmakers in the Missouri State Senate have come up with a plan that would add tax credits for businesses that add jobs with above-average wages and health insurance. The plan is a dramatic overhaul of the job-creation bill backed by Gov. Jay Nixon and passed overwhelmingly by the House.
However, senators concerned that Missouri’s tax breaks have grown out of control introduced a 250-page bill placing a dollar cap on the amount of tax credits that can be authorized annually for each program proposed in the House version of the measure.
Tax credit authorizations for the renovation of historic buildings, for example, would be limited at $50 million annually. They currently are an unlimited entitlement for developers who meet the eligibility criteria.
The legislation also would impose other restrictions on state tax breaks, including:
– For the first time, making the total amount allocated annually for each tax credit subject to legislative approval as part of the state budget.
– Prohibiting tax credit recipients from receiving benefits from multiple tax incentive programs for the same project.
– Imposing an automatic expiration date on each tax credit programs, which would require future legislative approval to extend.
– Adding the approval of the House and Senate budget chairmen to that of three executive branch officials as a necessary step for the Missouri Development Finance Board to exceed its annual cap on tax credits for projects.
Missouri forwent nearly $505 million of revenues during the 2008 fiscal year because of tax credits – a more than 40 percent increase from five years ago. But supporters claim targeted tax credits can help create new tax revenues by allowing businesses to employ more people, who in turn pay income and sales taxes.
The tax credit bill is SB45.
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