JEFFERSON CITY, MO (KMOX) - The Missouri General Assembly gave final passage to a bill dropping income taxes on Social Security retirement benefits, along with effectively freezing property tax increases. Senate Bill 190 gained final passage in the House Monday on a 154-2 vote, with a few Democrats asking how the state will make up for the more than $300-million in lost revenue. Republicans carrying the Senate bill had no answer for that.
Missouri is one of only 11 states that tax Social Security retirement payments, which - according to AARP - is seen as a disqualifier for many who are seeking a friendly state to retire. In addition, the bill provides numerous pensions to also avoid the income tax. Representative Jerome Barnes of Jackson County said on the floor during discussions, "I get calls from constituents in my district all the time about the tax on Social Security. This will be a significant help for our seniors."
The bill also provides a state tax credit relating to property taxes. Representative Ben Baker carried Senate Bill 190 in the House, and says those 65 and older will get the credit for the amount of any increase in property taxes, effectively freezing their tax rate. "Seniors who played by the rules their entire lives, saved for retirement, payed their fair share of taxes should never face the prospect of being taxed out of their home by the government."
Democrat Deb Lavender of St. Louis County had concerns. "The Social Security is what gives me a little heartburn." She said during the discussion. "There is a $318-million fiscal note on this and there is no cap on this at all." While Rep. Lavender supported helping seniors on fixed incomes, she and other Democrats would have preferred there to be a wealth test for who qualifies." She concluded, "Yes, it helps some of our seniors who need that help, and it helps all of the rest of them who don't need this at all."
The bill would take effect on January 1, 2024 if signed into law by Governor Mike Parson.
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