Summary of the Introduced Bill

HB 503 -- Taxation

Co-Sponsors:  Campbell, Hilgemann, Lowe, Riback Wilson (25),
Graham, Johnson (90), Carnahan

This bill makes various changes related to taxation.  The bill:

(1)  Requires every vendor or affiliate of a vendor seeking to
contract to provide goods and services to the State of Missouri
to collect and properly pay all sales and use taxes;

(2)  Imposes an individual income tax surcharge of 5% of income
taxes owed on taxpayers with a federal adjusted gross income of
$200,000 or more;

(3)  Beginning January 1, 2004, reduces the state corporate
income tax rate from 6.25% to 5.25%;

(4)  Limits the current state individual income tax deduction for
certain pensions to only amounts included in federal adjusted
gross income and not otherwise deducted in the calculation of
Missouri taxable income;

(5)  Requires all lottery and other gaming winnings to be
included in Missouri nonresident adjusted gross income when the
winnings are from a Missouri source;

(6)  Modifies the way losses and operating expenses are deducted
among parties for various types of property, including
intellectual property.  Minimum standards are established
regarding what connections among various corporate entities
constitute related parties and affiliated groups for multi-state
corporate income tax purposes;

(7)  Modifies the apportionment fraction allowed under Missouri
corporation income tax for determining the amount of income
apportioned to Missouri from business activities of the
corporation;

(8)  Restricts the current definition of "common carrier" for
purposes of qualifying for a state and local sales and use tax
exemption;

(9)  Authorizes a state and local sales and use tax holiday for
certain clothing, personal computers, and school supplies
purchased during a three-day period every August.  Local
political subdivisions may opt out their levies from the tax
holiday.  The Sales Tax Holiday Joint Committee is created to
study the effects of the tax holiday and make recommendations to
the General Assembly;

(10)  Prohibits retailers from obtaining refunds of sales and use
taxes without crediting the original purchasers, except for
over-collections of less than $1,000 to be refunded without the
higher burden of returning the funds to the purchaser.  The
$1,000 threshold is an aggregate sum over a five-year period.  A
retailer, upon submission of an approved plan by the Director of
the Department of Revenue, may offer fixed value coupons to
customers to satisfy the distribution of the over-collections;

(11)  Eliminates the in-lieu tax on certain large boats or
vessels documented with the U. S. Coast Guard.  These boats and
vessels will be subject to state and local sales and use taxes;

(12)  Allows the Secretary of State to dissolve a corporation
administratively if the corporation fails to file a Missouri
corporation franchise report;

(13)  Automatically decouples Missouri income tax provisions when
the federal government amends the Internal Revenue Code in a
manner that affects the determination of Missouri taxable income;

(14)  Requires a tax clearance from the Department of Revenue
prior to the issuance or renewal of any local government business
license;

(15)  Requires as a condition of employment with the executive
branch of state government that all state taxes due be filed and
paid by the employee;

(16)  Requires a tax clearance from the Department of Revenue
prior to the issuance or renewal of any professional license
granted by the state; and

(17)  Eliminates the timely filing allowance for employers
collecting and remitting state income tax withholdings.

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Missouri House of Representatives
Last Updated July 25, 2003 at 10:12 am