HCS HB 186 & 172 -- SALES AND USE TAX HOLIDAY

SPONSOR:  O'Toole (Troupe)

COMMITTEE ACTION:  Voted "do pass" by the Committee on
Miscellaneous Bills and Resolutions by a vote of 6 to 0.

This substitute exempts from state and local sales and use tax
the sale of certain clothing sold between the hours of 12:01
a.m., August 9, 2001, and midnight, August 12, 2001.  Each
individual item must sell for $100 or less to qualify for the
exemption.  Cities or counties imposing sales tax on retail
sales of clothing are authorized to exempt sales during the
period specified in the bill.  The governing body of the city or
county is required to immediately notify the Director of the
Department of Revenue of its action.

The substitute contains an emergency clause.

FISCAL NOTE:  Estimated Net Loss to General Revenue Fund of
$2,186,425 in FY 2002, $0 in FY 2003, and $0 in FY 2004.  Loss
to School District Trust Fund of $704,405 in FY 2002, $0 in FY
2003, and $0 in FY 2004.  Loss to Conservation Fund of $88,051
in FY 2002, $0 in FY 2003, and $0 in FY 2004.  Loss to Parks and
Soil Funds of $70,441 in FY 2002, $0 in FY 2003, and $0 in FY
2004.

PROPONENTS:  Supporters of HB 186 and HB 172 say that this type
of temporary sales tax exemption is successful in other states
in helping families at the beginning of the school year.
Retailers often mark down merchandise to bring it into the
qualifying price range.

Testifying for the bills were Representatives Froelker and
O'Toole; May Department Stores; and Missouri Retailers
Association.

OPPONENTS:  Those who oppose HB 186 and HB 172 say that revenues
will be eroded by the sales tax holiday and that cities and
counties cannot afford the decrease in revenue.

Testifying against the bills were Missouri Municipal League; St.
Louis County Municipal League; and Missouri Association of
Counties.

Donna Schlosser, Legislative Analyst

Missouri House of Representatives
Last Updated November 26, 2001 at 11:42 am