Renowned economist Arthur Laffer endorses Missouri's Income Tax Reform Plan:
http://www.americansforprosperity.org/011710-missouris-economy-will-be-better-no-income-tax
The Missouri Jobs & Properity Act begins debate in the Missouri Senate:
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Benefits of the Missouri Jobs & Prosperity Act (HJR 56, 71 & SJR 29)
Summary: Current MO sales tax collections would be expanded to include a sales tax on both new goods and services (no tax on used goods). It would replace the 6.25% corporate income tax upon implementation and the current 6% tax on personal income would be phased out over 5 years.*
Increases take-home pay
Wage earners will see an increase in disposable income because there would no longer be state withholding from their paychecks.
Shifts business focus from taxation to customers and employees
Business resources currently being spent on tracking, minimizing, and paying state income and franchise taxes can be invested in productivity increases, growing the business, expanding benefits, etc.
Real pay-raise for lowest income earners
By eliminating hidden business income taxes that go into product prices and refunding sales taxes, many families will pay no state taxes at all. They are currently paying taxes every time they buy a product because of the embedded business taxes.
Eliminates government control on how we spend our income
The present system of income taxes and tax credits/exemptions has empowered government for social engineering and manipulation of the public. Such power is not in the best interest of Missourians and is eliminated by shifting to a sales tax.
Eliminates the disincentive for success by taxing consumption, not labor
Reason concludes we will get more of what we subsidize and less of what we tax. Therefore, the income tax is a disincentive to income. It will either reduce the incentive for labor or increase the incentive to hide income. Our tax reform plan encourages savings. Increased savings means increased capitol. The resulting reduced interest rates create market effects that pressure prices downward.
More stable than income tax
Historical comparison reveals Missouri’s sales tax to have provided a more stable revenue stream than the income tax.
Taxes thieves, cheaters, and illegals
Illegal income gets taxed when the dollars are spent. Reduced complexity will make it easier to comply and harder to cheat. Illegal aliens purchase goods and services and will pay taxes.
Jump-starts Missouri's job-creation engine.
This at a critical time during the current economic downturn.
Provides real incentive for new or relocating businesses
Lowers the economic hurdles to starting a new business and makes Missouri a more attractive business location than competing states that still have income and franchise taxes on businesses.
Expands tax base to both services and retail sales
Currently, most services do not incur sales taxes. These services, including rents will all be taxable at the new rate. For most services there will be little or no increase in prices since embedded income taxes will disappear.
Provides an incubator to prove that the FairTax theory works in practice.
When it works in Missouri and people seek the economic benefits, other states and the federal government will be more willing to eliminate their burdensome income tax systems.
*Missouri's income tax reform plan has no affect on local property taxes and is designed to keep local sales taxes revenue neutral during the transition. Local sales tax revenues will still be able to grow as the economy grows into the future.
Find more details here: http://www.meetup.com/MO-Tax-Reform/files/