CHICAGO - Missouri Gov. Jay Nixon is warning that the $620 million tax cut legislation passed by the Legislature could end up costing the state more than $4.8 billion in revenue.
Nixon, a Democrat, released a fiscal analysis from his administration and a Washington University School of Law professor that concludes the legislation eliminates all state income tax on earnings of more than $9,000 now considered the top bracket.
Republicans, who control the legislature and pushed through the package, called Nixon's claims ridiculous and citied their own legal opinion from a former Missouri Supreme Court Chief Justice that the top income tax bracket would apply to those with earnings of more than $8,000.
The legislature gradually cuts the state's top individual income tax rate to 5.5 % from 6% and phases in a 25% cut for business income. Republicans estimate the total annual cost once all pieces are phased in to be $620 million.
Nixon has not said that he would veto the legislation but he is expected to do so. He vetoed a tax cut package last year and the legislature could not drum up enough support for the two-thirds vote needed to override the veto.
"For generations, Democrats and Republicans have worked together to protect Missouri's spotless AAA credit rating and keep our state on a fiscally responsible path. Now is not the time to veer off this proven course," Nixon said in a statement. "That's why I'm calling on members of the legislature to abandon this dangerous scheme, and work with us on a responsible approach."
