Voters firmly shoot down Amendment 5
The vote maintains the state individual income tax, which the legislature already has the power to adjust.
Election officials Susan Taylor, left, and Dan Kammer help a voter with curbside voting Tuesday at Fairview Elementary School. “The idea of doing something in the community, civic duty so to speak,” Kammer said when asked why he became an election official. “Plus, I thought it would be nice to do something different than I normally do in a day.”
Election official Judi Schoonover, left, helps Sterling Hopkins, 9, with his kids ballot on Tuesday at Fairview Elementary School. Boone County elections officials provide a kids ballot to allow children of voters to feel like part of the voting process. The elementary school served as one of many polling places around Boone County.
Missouri voters strongly rejected the legislature’s attempt to eliminate personal income tax on Tuesday.
The Associated Press called the Amendment 5 race less than two hours after polls closed, with roughly 80% of voters choosing to reject the expansion of sales taxes.
Amendment 5 would have allowed lawmakers the power to raise and expand sales taxes to any good or service in order to eliminate the state’s individual income tax, overriding previous constitutional amendments.
The Missouri General Assembly would have been tasked with replacing the roughly $9 billion collected in individual income tax revenue every year, which accounts for roughly two-thirds of the general tax revenue. The state’s sales and use tax revenue, which is approximately $3 billion a year, would have needed to be increased drastically.
The amendment’s failure comes after months of criticism from its opponents, who pointed to its lack of detail about which services lawmakers would want to increase sales taxes on.
Opposition to the amendment was led by the Missouri Realtors, which rallied a coalition of organizations to reject both Amendments 4 and 5.
“This election proved that our constitution works, and the 25,000 Missouri REALTORS and our coalition partners are proud and honored to have led the defense of our constitution and the protection of Missouri taxpayers,” Scott Charton, spokesperson for Missouri Realtors, said in a statement.
“When our constitutional protections and the 118-year-old citizens’ initiative process were threatened, REALTORS stood up,” the statement added.
Gov. Mike Kehoe, a major supporter of Amendment 5, published a statement following the results, which said his office will continue to work with the General Assembly to find ways to cut taxes.
“Throughout this conversation on eliminating the state income tax, we made the case that Missouri should think boldly about its future, challenge the status quo, and pursue policies that make our state more competitive,” the statement read. “While Amendment 5 did not earn the support it needed, I believe our work is far from over.”
Following Amendment 5’s defeat, House Minority Leader Ashley Aune, D-Kansas City, also released a statement. She noted the results Tuesday may be a prelude to November.
“Missouri voters just made clear they won’t let Republicans rewrite the rules to protect their own power and line the pockets of the ultra-wealthy,” the statement read.
“In November, voters have the chance to send another powerful message to Jefferson City Republicans: If you mess with Missourians’ rights, you will pay the political price,” the statement added.
Kehoe and the amendment’s co-sponsor, Rep. Bishop Davidson, R-Republic, adamantly stated they would not have allowed an expansion of sales taxes to necessities related to agriculture, real estates and healthcare.
However, the amendment’s language didn’t explicitly exempt those services from being taxed.
Jessica Ann, a tax analyst with the Missouri Budget Project, a nonprofit organization that educates the public on budget policy, noted the difficulty in projecting the effects of Amendment 5.
“The fact that we can’t even do estimates about how this could impact people because there are too few details is a pretty terrifying thing,” Ann said leading up to Election Day. “Because that means if we can’t do it, that means the state can’t do it.”
Missouri’s current individual income tax rate is graduated, ranging from 2% to 4.7%, with the top rate beginning at $9,191 taxable income. The general sales tax rate is 4.225%.
Opponents of the amendment also said that passing the provision would hurt low- to middle-income households.
“Eliminating the income tax rigs the system for the wealthy, while hurting working people, families and communities,” said Amy Blouin, president and CEO of Missouri Budget Project in a statement after Tuesday’s election. “We’ll continue to work with educators, parents, seniors and concerned Missourians across the state to build an economy that works for us all.”
Davidson said if Amendment 5 had passed and the individual income tax was eliminated, the average Missouri taxpayer could have earned between $2,704 to $2,872 more after adjustments each year, according to the Council of Economic Advisers.
The Institute on Taxation and Economic Policy, a nonprofit, nonpartisan tax policy organization, came out with different estimates.
It reported in July that middle-class Missourians with incomes of about $50,000 to $80,000 would pay $535 more in taxes if the individual income tax was eliminated and the sales tax was expanded.