Despite years of ever-growing tax giveaways, Missouri’s Year To Date general revenue at the end of May 2017 reported out at 2.6% above the end of May 2016.
That’s not enough to meet budget projections yet sufficient to trigger new tax cuts.
According to the official May revenue report from the Office of Administration [ https://oa.mo.gov/commissioners-office/news/state-releases-may-2017-general-revenue-report ], by the end of this May the state had collected $8.35 billion this Fiscal Year, compared to $8.14 billion at the end of last May.
► That 2.6% increase is well short of the revised, lower estimate of 3% growth
used by the legislature for this fiscal year. A prudent governor might
insist on tens of millions of dollars in additional cuts to expenditures before
the end of the Fiscal Year on June 30th. (Don’t wait up.)
► The net increase in revenue, about $210 million by May 31st, means that
at the end of June revenue will be up enough to trigger around $100
million in tax cuts. That’s due to legislation championed by Sen. Will Krauss
and strongly supported by now-Treasurer Eric Schmidt and the GOP majority a
couple of years back. Certain “job creators,” like law firms, will see significant
income tax cuts. Most regular Missouri taxpayers will see the top rate drop from
6% of income to 5.9%. (About $45 less taxes on $55,000 income.)
► Trend data from FY2017 suggests that Governor SEAL will have no choice
but to withhold hundreds of millions of dollars from the budget approved
by Missouri Legislators last month for Fiscal Year 2018 which begins July 1st.
That means state operations, such as Mizzou, will get less money than advertised
beginning next month.
By the way, I’ve heard a respected member of the legislature predict that the FY 2019 budget will require “draconian cuts” much deeper than the pain inflicted this year. No one, of course, will seriously consider any sort of revenue increase in an election year.
If that weren’t depressing enough, word from Washington is that President Donald won’t get all the cuts he wants but that Republican majority in Congress will trim domestic spending by hundreds of billions of dollars: Missouri will get less federal dollars, forcing our state to make additional cuts to state programs and services.
Don’t worry. Most of the federal cuts will only hurt kids, seniors and poor people.
Coming back to Missouri, that revenue report for May showed modest increases in individual income tax and sales tax collections. Corporate taxes, meanwhile, were down by 11.1%. Big surprise.
Submitted by Glenn Koenen, WCD Member