HCS HB 506, 291 -- INCOME TAX

SPONSOR:  Jacob (Gratz)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Ways and
Means by a vote of 16 to 0.

This substitute authorizes an individual income tax deduction to
self-employed taxpayers for 50% of their health insurance
premiums and for their spouse and dependents.  The deduction
will not be allowed if the taxpayer or spouse is eligible to
participate in any subsidized health plan maintained by an
employer, nor if a similar deduction is allowed on the federal
income tax return.

This substitute will become effective January 1, 1996, and
applies to all taxable years beginning after December 31, 1995.

FISCAL NOTE:  Not available at time of this printing.

PROPONENTS:  Supporters say that this substitute will help small
business and continue a deduction that formerly was allowed on
the federal return, but has now been repealed.

Testifying for the bill were Representative Gratz; Associated
Industries of Missouri; and the National Federation of
Independent Businesses of Missouri.

OPPONENTS:  There was no opposition voiced to the committee.

Bill Tucker, Research Analyst

HB 506 -- State Income Tax

Co-Sponsors:  Gratz, Garnett, Rizzo, Vogel

This bill authorizes an individual income tax deduction to self--
employed taxpayers for 50% of their health insurance premiums
and for their spouse and dependents.  The deduction will not be
allowed if the taxpayer or spouse is eligible to participate in
any subsidized health plan maintained by an employer, nor if a
similar deduction is allowed on the federal income tax return.

This bill will become effective January 1, 1996, and applies to
all taxable years beginning after December 31, 1995.