Bill Text: MO HB152 | 2011 | Regular Session | Introduced
Bill Title: Decreases the individual income tax rate, eliminates corporate income tax, authorizes a sales tax on taxable services, and authorizes the Department of Revenue to establish a sales tax rebate program
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2011-01-27 - Referred: Tax Reform (H) [HB152 Detail]
Download: Missouri-2011-HB152-Introduced.html
FIRST REGULAR SESSION
96TH GENERAL ASSEMBLY
INTRODUCED BY REPRESENTATIVE KELLY (24).
0639L.01I D. ADAM CRUMBLISS, Chief Clerk
AN ACT
To repeal sections 143.011, 143.071, 144.010, and 144.020, RSMo, and to enact in lieu thereof five new sections relating to taxation.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Sections 143.011, 143.071, 144.010, and 144.020, RSMo, are repealed and five new sections enacted in lieu thereof, to be known as sections 143.011, 143.071, 143.126, 144.010, and 144.020, to read as follows:
143.011. 1. A tax is hereby imposed for every taxable year on the Missouri taxable income of every resident. Except as provided in subsection 2 of this section, the tax shall be determined by applying the tax table or the rate provided in section 143.021, which is based upon the following rates:
If the Missouri taxable income is: The tax is:
Not over $1,000.00 ................................... 1 1/2% of the Missouri taxable income
Over $1,000 but not over $2,000 .............. $15 plus 2% of excess over $1,000
Over $2,000 but not over $3,000 .............. $35 plus 2 1/2% of excess over $2,000
Over $3,000 but not over $4,000 .............. $60 plus 3% of excess over $3,000
Over $4,000 but not over $5,000 .............. $90 plus 3 1/2% of excess over $4,000
Over $5,000 but not over $6,000 .............. $125 plus 4% of excess over $5,000
Over $6,000 but not over $7,000 .............. $165 plus 4 1/2% of excess over $6,000
Over $7,000 but not over $8,000 .............. $210 plus 5% of excess over $7,000
Over $8,000 but not over $9,000 .............. $260 plus 5 1/2% of excess over $8,000
Over $9,000 .............................................. $315 plus 6% of excess over $9,000
2. (1) For the tax years beginning on or after January 1, 2014, but ending on or before December 31, 2018, the tax on the Missouri taxable income of every resident with a Missouri adjusted gross income of sixty thousand dollars or less shall be determined by applying the following tax table:
If the Missouri taxable income is: The tax is:
Not over $3,000.00 .................................... 1/2% of the Missouri taxable income
Over $3,000 but not over $4,000 .............. $15 plus 1% of excess over $3,000
Over $4,000 but not over $5,000 .............. $25 plus 1 1/2% of excess over $4,000
Over $5,000 but not over $6,000 .............. $40 plus 2% of excess over $5,000
Over $6,000 but not over $7,000 .............. $60 plus 2 1/2% of excess over $6,000
Over $7,000 but not over $8,000 .............. $85 plus 3% of excess over $7,000
Over $8,000 but not over $9,000 .............. $115 plus 3 1/2% of excess over $8,000
Over $9,000 ................................................ $150 plus 4% of excess over $9,000
(2) For the tax years beginning on or after January 1, 2014, but ending on or before December 31, 2018, the tax on the Missouri taxable income of every resident with a Missouri adjusted gross income of more than sixty thousand dollars but not exceeding one hundred thousand dollars shall be determined by applying the following tax table:
If the Missouri taxable income is: The tax is:
Not over $1,000.00 .................................... 1/2% of the Missouri taxable income
Over $1,000 but not over $2,000 .............. $5 plus 1% of excess over $1,000
Over $2,000 but not over $3,000 .............. $15 plus 1 1/2% of excess over $2,000
Over $3,000 but not over $4,000 .............. $30 plus 2% of excess over $3,000
Over $4,000 but not over $5,000 .............. $50 plus 2 1/2% of excess over $4,000
Over $5,000 but not over $6,000 .............. $75 plus 3% of excess over $5,000
Over $6,000 but not over $7,000 .............. $110 plus 3 1/2% of excess over $6,000
Over $7,000 but not over $8,000 .............. $150 plus 4% of excess over $7,000
Over $8,000 but not over $9,000 .............. $115 plus 4 1/2% of excess over $8,000
Over $9,000 ................................................ $195 plus 5% of excess over $9,000
143.071. 1. [For all tax years beginning before September 1, 1993, a tax is hereby imposed upon the Missouri taxable income of corporations in an amount equal to five percent of Missouri taxable income.
2.] Except as provided in subsection 2 of this section, for all tax years beginning on or after September 1, 1993, a tax is hereby imposed upon the Missouri taxable income of corporations in an amount equal to six and one-fourth percent of Missouri taxable income.
2. For all tax years beginning on or after January 1, 2014, but ending on or before December 31, 2018, no tax shall be imposed upon the Missouri taxable income of corporations.
143.126. 1. For all tax years beginning on or after January 1, 2014, but ending on or before December 31, 2018, each taxpayer may claim a sales tax rebate as provided in this section. Any sales tax rebate provided to the taxpayer shall be in the following amounts:
(1) Two hundred dollars if the taxpayer's Missouri adjusted gross income does not exceed one hundred percent of the poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. Section 9902(2), as amended;
(2) One hundred dollars if the taxpayer's Missouri adjusted gross income is more than one hundred percent but does not exceed two hundred percent of the poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. Section 9902(2), as amended;
(3) Fifty dollars if the taxpayer's Missouri adjusted gross income is more than two hundred percent but does not exceed three hundred percent of the poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. Section 9902(2), as amended.
2. To claim the sales tax rebate under this section, the taxpayer shall submit an application for the sales tax rebate on a form authorized and provided by the department of revenue. The application shall be filed with the department at the end of each calendar quarter in which sales taxes were paid and for which a sales tax rebate is claimed under this section. The application shall include any receipts, documentation, and information required by the department. If the taxpayer complies with all criteria required by this section, the department shall issue a sales tax rebate in the appropriate amount.
3. The department of revenue may promulgate rules to implement the provisions of this section. Any rule or portion of a rule, as that term is defined in section 536.010, that is created under the authority delegated in this section shall become effective only if it complies with and is subject to all of the provisions of chapter 536 and, if applicable, section 536.028. This section and chapter 536 are nonseverable and if any of the powers vested with the general assembly under chapter 536 to review, to delay the effective date, or to disapprove and annul a rule are subsequently held unconstitutional, then the grant of rulemaking authority and any rule proposed or adopted after August 28, 2011, shall be invalid and void.
144.010. 1. The following words, terms, and phrases when used in sections 144.010 to 144.525 have the meanings ascribed to them in this section, except when the context indicates a different meaning:
(1) "Admission" includes seats and tables, reserved or otherwise, and other similar accommodations and charges made therefor and amount paid for admission, exclusive of any admission tax imposed by the federal government or by sections 144.010 to 144.525;
(2) "Business" includes any activity engaged in by any person, or caused to be engaged in by him, with the object of gain, benefit or advantage, either direct or indirect, and the classification of which business is of such character as to be subject to the terms of sections 144.010 to 144.525. The isolated or occasional sale of tangible personal property, service, substance, or thing, by a person not engaged in such business, does not constitute engaging in business within the meaning of sections 144.010 to 144.525 unless the total amount of the gross receipts from such sales, exclusive of receipts from the sale of tangible personal property by persons which property is sold in the course of the partial or complete liquidation of a household, farm or nonbusiness enterprise, exceeds three thousand dollars in any calendar year. The provisions of this subdivision shall not be construed to make any sale of property which is exempt from sales tax or use tax on June 1, 1977, subject to that tax thereafter;
(3) "Gross receipts", except as provided in section 144.012, means the total amount of the sale price of the sales at retail including any services other than charges incident to the extension of credit that are a part of such sales made by the businesses herein referred to, capable of being valued in money, whether received in money or otherwise; except that, the term "gross receipts" shall not include the sale price of property returned by customers when the full sale price thereof is refunded either in cash or by credit. In determining any tax due under sections 144.010 to 144.525 on the gross receipts, charges incident to the extension of credit shall be specifically exempted. For the purposes of sections 144.010 to 144.525 the total amount of the sale price above mentioned shall be deemed to be the amount received. It shall also include the lease or rental consideration where the right to continuous possession or use of any article of tangible personal property is granted under a lease or contract and such transfer of possession would be taxable if outright sale were made and, in such cases, the same shall be taxable as if outright sale were made and considered as a sale of such article, and the tax shall be computed and paid by the lessee upon the rentals paid;
(4) "Livestock", cattle, calves, sheep, swine, ratite birds, including but not limited to, ostrich and emu, aquatic products as defined in section 277.024, llamas, alpaca, buffalo, elk documented as obtained from a legal source and not from the wild, goats, horses, other equine, or rabbits raised in confinement for human consumption;
(5) "Motor vehicle leasing company" shall be a company obtaining a permit from the director of revenue to operate as a motor vehicle leasing company. Not all persons renting or leasing trailers or motor vehicles need to obtain such a permit; however, no person failing to obtain such a permit may avail itself of the optional tax provisions of subsection 5 of section 144.070, as hereinafter provided;
(6) "Person" includes any individual, firm, copartnership, joint adventure, association, corporation, municipal or private, and whether organized for profit or not, state, county, political subdivision, state department, commission, board, bureau or agency, except the state transportation department, estate, trust, business trust, receiver or trustee appointed by the state or federal court, syndicate, or any other group or combination acting as a unit, and the plural as well as the singular number;
(7) "Purchaser" means a person who purchases tangible personal property or to whom are rendered services, receipts from which are taxable under sections 144.010 to 144.525;
(8) "Research or experimentation activities" are the development of an experimental or pilot model, plant process, formula, invention or similar property, and the improvement of existing property of such type. Research or experimentation activities do not include activities such as ordinary testing or inspection of materials or products for quality control, efficiency surveys, advertising promotions or research in connection with literary, historical or similar projects;
(9) "Sale" or "sales" includes installment and credit sales, and the exchange of properties as well as the sale thereof for money, every closed transaction constituting a sale, and means any transfer, exchange or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for valuable consideration and the rendering, furnishing or selling for a valuable consideration any of the substances, things and services herein designated and defined as taxable under the terms of sections 144.010 to 144.525;
(10) "Sale at retail" means any transfer made by any person engaged in business as defined herein of the ownership of, or title to, tangible personal property to the purchaser, for use or consumption and not for resale in any form as tangible personal property, for a valuable consideration; except that, for the purposes of sections 144.010 to 144.525 and the tax imposed thereby: (i) purchases of tangible personal property made by duly licensed physicians, dentists, optometrists and veterinarians and used in the practice of their professions shall be deemed to be purchases for use or consumption and not for resale; and (ii) the selling of computer printouts, computer output or microfilm or microfiche and computer-assisted photo compositions to a purchaser to enable the purchaser to obtain for his or her own use the desired information contained in such computer printouts, computer output on microfilm or microfiche and computer-assisted photo compositions shall be considered as the sale of a service and not as the sale of tangible personal property. Where necessary to conform to the context of sections 144.010 to 144.525 and the tax imposed thereby, the term "sale at retail" shall be construed to embrace:
(a) Sales of admission tickets, cash admissions, charges and fees to or in places of amusement, entertainment and recreation, games and athletic events;
(b) Sales of electricity, electrical current, water and gas, natural or artificial, to domestic, commercial or industrial consumers;
(c) Sales of local and long distance telecommunications service to telecommunications subscribers and to others through equipment of telecommunications subscribers for the transmission of messages and conversations, and the sale, rental or leasing of all equipment or services pertaining or incidental thereto;
(d) Sales of service for transmission of messages by telegraph companies;
(e) Sales or charges for all rooms, meals and drinks furnished at any hotel, motel, tavern, inn, restaurant, eating house, drugstore, dining car, tourist camp, tourist cabin, or other place in which rooms, meals or drinks are regularly served to the public;
(f) Sales of tickets by every person operating a railroad, sleeping car, dining car, express car, boat, airplane, and such buses and trucks as are licensed by the division of motor carrier and railroad safety of the department of economic development of Missouri, engaged in the transportation of persons for hire;
(11) "Seller" means a person selling or furnishing tangible personal property or rendering services, on the receipts from which a tax is imposed pursuant to section 144.020;
(12) The noun "tax" means either the tax payable by the purchaser of a commodity or service subject to tax, or the aggregate amount of taxes due from the vendor of such commodities or services during the period for which he or she is required to report his or her collections, as the context may require;
(13) "Telecommunications service", for the purpose of this chapter, the transmission of information by wire, radio, optical cable, coaxial cable, electronic impulses, or other similar means. As used in this definition, "information" means knowledge or intelligence represented by any form of writing, signs, signals, pictures, sounds, or any other symbols. Telecommunications service does not include the following if such services are separately stated on the customer's bill or on records of the seller maintained in the ordinary course of business:
(a) Access to the Internet, access to interactive computer services or electronic publishing services, except the amount paid for the telecommunications service used to provide such access;
(b) Answering services and one-way paging services;
(c) Private mobile radio services which are not two-way commercial mobile radio services such as wireless telephone, personal communications services or enhanced specialized mobile radio services as defined pursuant to federal law; or
(d) Cable or satellite television or music services; and
(14) "Product which is intended to be sold ultimately for final use or consumption" means tangible personal property, or any service that is subject to state or local sales or use taxes, or any tax that is substantially equivalent thereto, in this state or any other state.
2. For purposes of the taxes imposed under sections 144.010 to 144.525, and any other provisions of law pertaining to sales or use taxes which incorporate the provisions of sections 144.010 to 144.525 by reference, the term "manufactured homes" shall have the same meaning given it in section 700.010.
3. Sections 144.010 to 144.525 may be known and quoted as the "Sales Tax Law".
4. For all tax years beginning on or after January 1, 2014, but ending on or before December 31, 2018, as used in this chapter, the following terms mean:
(1) "Basic interest rate":
(a) In the case of a debt instrument, investment, financing lease, or account with a term of not over three years, the applicable interest rate shall be a short-term rate based on the average market yield during any one month on outstanding marketable obligations of the United States with remaining periods to maturity of three years or fewer;
(b) In the case of a debt instrument, investment, financing lease, or account with a term of over three years but not over nine years, the applicable interest rate shall be a mid-term rate based on the average market yield during any one month on outstanding marketable obligations of the United States with remaining periods to maturity of more than three years but not over nine years;
(c) In the case of a debt instrument, investment, financing lease, or account with a term of over nine years, the applicable interest rate shall be a long-term rate based on the average market yield during any one month on outstanding marketable obligations of the United States with remaining periods to maturity of over nine years;
(2) "Business purpose", purchased by a person engaged in a trade or business and used in that trade or business for resale, to produce, provide, render, or sell taxable services, or in furtherance of other bona fide business purposes;
(3) "Education and training", tuition for primary, secondary, or postsecondary level education, and job-related training courses. "Education and training" shall not include room, board, sports activities, recreational activities, hobbies, games, arts or crafts, or cultural activities;
(4) "Government enterprise", any entity owned or operated by a federal, state, or local governmental unit or political subdivision that receives gross payments from private persons, except that a government-owned entity shall not be deemed a government enterprise under this section unless in any quarter it has revenues from selling taxable services that exceed two thousand five hundred dollars;
(5) "Gross imputed amount":
(a) With respect to any underlying interest-bearing investment or account, the product of:
a. The excess of the basic interest rate over the rate paid on such investment; and
b. The amount of the investment or account;
(b) With respect to any underlying interest-bearing debt, the product of:
a. The excess of the rate paid on such debt over the basic interest rate; and
b. The amount of the debt;
(6) "Implicitly charged fees", includes the gross imputed amount in relation to any underlying interest-bearing investment, account, or debt;
(7) "Investment purpose", property purchased exclusively for purposes of appreciation or the production of income but not entailing more than minor personal efforts;
(8) "Mixed use service", a taxable service used for both taxable use or consumption and for a business purpose;
(9) "Nonprofit organization", any nonprofit organization, no part of the net earnings of which inures to the benefit of any private shareholder or individual, that is organized and operated exclusively:
(a) For religious, charitable, scientific, testing for public safety, literary, or educational purposes;
(b) As a civic league or social welfare organization;
(c) As a labor, agricultural, or horticultural organization;
(d) As a chamber of commerce, business league, or trade association; or
(e) As a fraternal beneficiary society, order, or association;
(10) "Produce, provide, render, or sell taxable services", includes the following:
(a) A taxable service is used to produce, provide, render, or sell a taxable service if such service is purchased by a person engaged in a trade or business for the purpose of employing or using such taxable service in the production, provision, rendering, or sale of other taxable services in the ordinary course of that trade or business;
(b) Taxable services used in a trade or business for the purpose of research, experimentation, testing, and development shall be treated as used to produce, provide, render, or sell taxable services;
(c) Taxable services purchased by an insurer on behalf of an insured shall be treated as used to produce, provide, render, or sell taxable services if the premium for the insurance contract giving rise to the insurer's obligation was subject to tax on financial intermediation services under this section;
(d) Education and training shall be treated as services used to produce, provide, render, or sell taxable services;
(11) (a) "Taxable employer", includes, but is not limited to, the following:
a. Any household employing domestic servants; and
b. Any government except for government enterprises.
(b) "Taxable employer" shall not include any employer that is:
a. Engaged in a trade or business;
b. A nonprofit organization; or
c. A government enterprise;
(12) (a) "Taxable service", any service, including any financial intermediation services, and including any service performed by an employee for which the employee is paid wages by a taxable employer, or any service performed by an employee for which the employee is paid wages:
a. By an employer in the regular course of the employer's trade or business;
b. By an employer that is a nonprofit organization;
c. By an employer that is a government enterprise; or
d. By taxable employers to employees directly providing education and training.
(b) "Taxable service" shall not include any taxable service purchased for a business purpose in a trade or business, any taxable service purchased for an investment purpose and held exclusively for an investment purpose, or any state government functions that do not constitute the final consumption of property or services;
(13) "Wages", all compensation paid for employment service including salaries, cash compensation, employee benefits, disability insurance, or wage replacement insurance payments, unemployment compensation insurance, workers' compensation insurance, and the fair market value of any other consideration paid by an employer to an employee in consideration for employment services rendered.
144.020. 1. A tax is hereby levied and imposed upon all sellers for the privilege of engaging in the business of selling tangible personal property or rendering taxable service at retail in this state. The rate of tax shall be as follows:
(1) Upon every retail sale in this state of tangible personal property, including but not limited to motor vehicles, trailers, motorcycles, mopeds, motortricycles, boats and outboard motors, a tax equivalent to four percent of the purchase price paid or charged, or in case such sale involves the exchange of property, a tax equivalent to four percent of the consideration paid or charged, including the fair market value of the property exchanged at the time and place of the exchange, except as otherwise provided in section 144.025;
(2) A tax equivalent to four percent of the amount paid for admission and seating accommodations, or fees paid to, or in any place of amusement, entertainment or recreation, games and athletic events;
(3) A tax equivalent to four percent of the basic rate paid or charged on all sales of electricity or electrical current, water and gas, natural or artificial, to domestic, commercial or industrial consumers;
(4) A tax equivalent to four percent on the basic rate paid or charged on all sales of local and long distance telecommunications service to telecommunications subscribers and to others through equipment of telecommunications subscribers for the transmission of messages and conversations and upon the sale, rental or leasing of all equipment or services pertaining or incidental thereto; except that, the payment made by telecommunications subscribers or others, pursuant to section 144.060, and any amounts paid for access to the Internet or interactive computer services shall not be considered as amounts paid for telecommunications services;
(5) A tax equivalent to four percent of the basic rate paid or charged for all sales of services for transmission of messages of telegraph companies;
(6) A tax equivalent to four percent on the amount of sales or charges for all rooms, meals and drinks furnished at any hotel, motel, tavern, inn, restaurant, eating house, drugstore, dining car, tourist cabin, tourist camp or other place in which rooms, meals or drinks are regularly served to the public;
(7) A tax equivalent to four percent of the amount paid or charged for intrastate tickets by every person operating a railroad, sleeping car, dining car, express car, boat, airplane and such buses and trucks as are licensed by the division of motor carrier and railroad safety of the department of economic development of Missouri, engaged in the transportation of persons for hire;
(8) A tax equivalent to four percent of the amount paid or charged for rental or lease of tangible personal property, provided that if the lessor or renter of any tangible personal property had previously purchased the property under the conditions of "sale at retail" [as defined in subdivision (8) of section 144.010] or leased or rented the property and the tax was paid at the time of purchase, lease or rental, the lessor, sublessor, renter or subrenter shall not apply or collect the tax on the subsequent lease, sublease, rental or subrental receipts from that property. The purchase, rental or lease of motor vehicles, trailers, motorcycles, mopeds, motortricycles, boats, and outboard motors shall be taxed and the tax paid as provided in this section and section 144.070. In no event shall the rental or lease of boats and outboard motors be considered a sale, charge, or fee to, for or in places of amusement, entertainment or recreation nor shall any such rental or lease be subject to any tax imposed to, for, or in such places of amusement, entertainment or recreation. Rental and leased boats or outboard motors shall be taxed under the provisions of the sales tax laws as provided under such laws for motor vehicles and trailers. Tangible personal property which is exempt from the sales or use tax under section 144.030 upon a sale thereof is likewise exempt from the sales or use tax upon the lease or rental thereof;
(9) A tax equivalent to four percent of the amount paid or charged for rendering any taxable service. This subdivision shall become effective on January 1, 2014, and shall expire on December 31, 2018.
2. All tickets sold which are sold under the provisions of sections 144.010 to 144.525 which are subject to the sales tax shall have printed, stamped or otherwise endorsed thereon, the words "This ticket is subject to a sales tax.".
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