HCS HB 1407 -- EARNED INCOME TAX CREDIT

SPONSOR:  Hilgemann (Riback Wilson, 25)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Ways and
Means by a vote of 14 to 2.

This substitute allows a state individual income tax credit equal
to a percentage of any earned income tax credit claimed by the
taxpayer on the federal income tax return.  The percentage of the
federal credit allowed will be 5% for tax year 2005, 10% for tax
year 2007, 15% for tax year 2009, and 20% for tax year 2011 and
thereafter.  Any amount of credit which exceeds the taxpayer's
liability in any tax year will be refunded to the taxpayer or
carried forward into future tax years.

The substitute also allows the General Assembly to delay the
implementation of the credit by one year by passage of a
concurrent resolution by both bodies.  Failure to pass a
resolution at any time would allow the implementation of the
credit.

FISCAL NOTE:  Estimated Net Cost to General Revenue Fund of $0 in
FY 2003, $0 in FY 2004, and $8,560,579 in FY 2005.

PROPONENTS:  Supporters say that the credit provides a premium
for the working poor to continue gainful employment versus going
on the welfare rolls.

Testifying for the bill were Representative Riback Wilson (25);
Catholic Charities; University Outreach and Extension; Citizens
for Missouri's Children; Salvation Army; Missouri Catholic
Conference; Missouri Impact; National Association of Social
Workers; Missouri Association for Community Action; Catholic
Diocese of Jefferson City; Missouri Association for Social
Welfare; and Reform Organization for Welfare.

OPPONENTS:  There was no opposition voiced to the committee.

Bill Tucker, Assistant Director of Research

Missouri House of Representatives
Last Updated October 11, 2002 at 9:01 am