HB 1341 -- Income Tax:  Flat Tax Act

Sponsor:  Hanaway

This bill creates the Flat Tax Act.

The bill removes all deductions, credits, losses, adjustments,
or modifications that reduce the tax liability of a corporation
or individual.  The bill does allow adjustments for tax-free
bonds and railroad retirement benefits.

The tax rates for individual income taxpayers will be: 3% of
Missouri taxable income if federal adjusted gross is $20,000 or
less for a single taxpayer and $40,000 or less for married
taxpayers filing a combined return; 4% of Missouri taxable
income if federal adjusted gross is greater than $20,000 but
less than $60,000 for a single taxpayer and greater than $40,000
but less than $120,000 for married taxpayers filing a combined
return; and 5% of Missouri taxable income if federal adjusted
gross is greater than $60,000 for a single taxpayer and greater
than $120,000 for married taxpayers filing a combined return.

The tax rate for Missouri corporations will be 4% of Missouri
taxable income.

The bill will become effective January 1, 2002.