Tag: taxation

House bills would help Missourians with vehicle taxation, stem temp tag ‘abuse’

      The House passed two bills this week that will help Missourians regarding the taxes they pay on vehicles.  One would address a years-old issue regarding temporary license tags.  The other would stem the hiking of property taxes on vehicles that are getting older with increasing mileage. 

Representative Michael O’Donnell (Photo: Tim Bommel, Missouri House Communications)

      House Bill 415 could at last cut off the displaying by drivers of expired temporary tags – something that has been an issue in Missouri for years.   It would require dealerships to collect sales tax at the time of a vehicle purchase, either as a lump sum or by rolling the tax into the financed amount.  House Bill 713 would lay out how vehicles’ assessed valuations would be determined, replacing a system that has allowed property tax increases in the last two years. 

      St. Louis Republican Michael O’Donnell carries HB 415, which he says is the latest step in addressing the temporary tag issue.  Under previous action by the General Assembly a new computer system is coming to the Department of Revenue that will allow the collection of sales tax by dealers.  This bill would allow for its use beginning in January.

      “There is no other thing that you purchase where you have to go someplace else to pay the sales tax.  You buy a pen, you pay the sales tax at that point.  [If this bill becomes law] you’re going to buy your car and you’re going to pay the sales tax when you buy it,” said O’Donnell. 

He said the bill could also make car and truck purchases easier for Missourians by addressing what can now be a significant up-front cost. 

      “[It would] allow for the sales tax, if you’re interested, if you’re financing, to roll the sales tax into the financing if you would like that.  For a lot of folks that becomes a more reasonable proposition because writing a check for $2,000 to pay the sales tax is a lot more difficult than adding $30 to your payments every month.”

      Bipartisan backing gave the bill a 155-1 vote on its way to the Senate.  Democrats including Peter Merideth (St. Louis) said it would be a fix that is “important,” and “overdue.”

      “I actually hear more from constituents about this than many other things, strangely – about the expired tags, and frequently have to have the conversation with them that the main problem in Missouri is that we aren’t requiring dealers to collect the sales tax at the time of sale,” said Merideth.  “So folks, either intentionally or not intentionally find themselves not getting their taxes paid and their licenses ready.”

      O’Donnell said the passage of this legislation could eliminate “90%” of “temp tag abuse” in Missouri, and noted that 47 other states already allow dealers to collect tax at the time of the sale.

Representative Roger Reedy (Photo: Tim Bommel, Missouri House Communications)

      The sponsor of HB 713, Rodger Reedy (R-Windsor) explained that each year Missouri assessors use the October edition of the National Automobile Dealers’ Association (NADA) Used Car Guide to determine the values of the vehicles on which Missourians pay property taxes.  HB 713 would replace that with a system that begins with the original suggested retail price (MSRP) of each vehicle from when it was new, and apply a depreciation schedule for each year of its age up to 15 years.  After that its value would be assessed at one-tenth of one percent.

      Reedy said the old system’s flaws were made obvious in the wake of the COVID pandemic. 

“In 2021 and ’22, due to used care values going up, our constituents and citizens had higher tax assessments and therefore paid higher taxes,” said Reedy.  “When those values went up, there’s no provision for rollbacks on personal property, and when that happened our taxpayers just got a taxing increase and I’ve talked to several members [who have said] that that’s been a really big issue as they’ve talked to their constituents.”

He called the bill a, “taxpayer protection act.  If there’s nothing else we can do, we can protect our taxpayers from unjustly having to pay more taxes on a vehicle that’s a year older that has more mileage.  I just don’t think it’s right to do that to our taxpayers.”

      That measure advanced to the Senate on the strength of a 150-0 vote.

House members push for lesser tax on feminine hygiene products, diapers

      Nine bills filed in the Missouri House would reduce or eliminate the taxes paid on diapers, and most of those would also apply to feminine hygiene products.  The bipartisan group of legislators backing them say such a change would help some among the Missourians who most need relief, especially during this period of increased inflation. 

Representative Maggie Nurrenbern (Photo: Tim Bommel, Missouri House Communications)

      The rate at which these products are taxed is sometimes referred to as a “luxury tax.”  That is the rate at which most products in Missouri are taxed.  Food is taxed at a decreased rate, and some of the proposals would set the levy on those products to that rate.  Others would make them exempt from the sales tax altogether.

      Several of the bills’ sponsors said there is no reason to keep taxing these things at the greater rate.

      “It’s ludicrous … these are not luxury items.  These are items that you need to exist and function in society, period,” said Kansas City Democrat Maggie Nurrenbern. 

      Similar bills have been offered for several years but have fallen short of becoming law.  Among their most fervent and consistent backers have been diaper banks.  Data released last year by the National Diaper Bank Network placed the annual cost of diapers at nearly $1,000 per infant.

“Over time for the average family, the average parent that’s buying diapers for their child over the course of the first three or four years that will add up,” said Representative Mark Sharp (D-Kansas City) of the tax on those diaper purchases.  “The least we can do at the state level is make sure that we’re taking care of the average person, the everyday person who’s just trying to make it and make sure that their child has adequate diapers [and we should] make sure that our older folks have the stuff they need as well.”

Representative Phil Christofanelli (Photo: Tim Bommel, Missouri House Communications)

      Republican Phil Christofanelli (R-St. Peters), sponsoring the proposal for the second straight year, said he thinks part of what has held it up in the past has been that it would significantly reduce revenue, particularly for local governments, “But I think this one’s important, particularly in our time of inflation, where the basic necessities for so many working families are incredibly high and we want to be a culture that encourages stable families and child rearing and a vibrant family culture and this is part of that, make sure that families can afford the necessities of raising kids.”

      Representative Peter Merideth (D-St. Louis) has for years sat on the House Budget Committee.  He said the state could afford this change.

“I do think that we can make it work with lowering the food tax and that the impact it will have on people is worth it, regardless.  If it means we have to adjust revenue elsewhere to make up for it I would support that too.”

      Merideth’s version of the bill would extend such changes to other necessities, such as, “Toothpaste, deodorant, soap, shampoo, but I do exempt sort of luxury cosmetic-type products.  So I think, again, the basic necessities, people just shouldn’t be paying taxes on them.”

Representative Peter Merideth (Photo: Tim Bommel, Missouri House Communications)

      In addition to this issue, St. Louis Representative Jo Doll (D) also proposes in House Bill 408 that public charter, middle- and high schools provide feminine hygiene products free to students.  She said that wouldn’t just be for students who can’t afford them, it’s about the mental health of young girls dealing with what might still be a new experience.

      “You might have them in your bathroom at home and all of a sudden you’re at school and you need one and you don’t want to have to go ask your math teacher, or the nurse, even, for a tampon.  There’s a huge mental health factor in just security that you always have those products available.”

      Regarding those who struggle to afford those products, Doll said, “We know that girls who can’t afford feminine hygiene products don’t go to school during that time and so this would just give them access to products that they may not be able to afford.”

Representative Jo Doll (Photo: Tim Bommel, Missouri House Communications)

      She adds, “They’re not optional and the lack of being able to afford them causes all kinds of issues for, whether it’s working mothers or school age girls.”

      The House sponsors and co-sponsors of those bills include a bipartisan group of 12 Democrats and four Republicans.  None of those bills have been referred to a committee.

      In the Senate three such measures have been filed.  Two of those, filed by Republicans, have been approved by a committee in that chamber.

The bills that have been filed are:

HB 114 (Sharp), HB 126 (Nurrenburn), HB 145 (Doll), HB 290 (Patty Lewis), HB 351 (Christofanelli), HB 381 (Rasheen Aldridge, Jr.), HB 744 (Stephanie Hein), HB 1053 (Barbara Phifer), and HB 1136 (Merideth)

Rep. Doll’s legislation to require schools to provide feminine hygiene products to students at no cost is HB 408.