HB 1249 -- SALES AND USE TAX EXEMPTIONS

SPONSOR:  Spreng

COMMITTEE ACTION:  Voted "do pass" by the Committee on Job
Creation and Economic Development by a vote of 18 to 0.

This bill exempts all motor vehicles assembled and sold in
Missouri from the state sales and use tax.  Local sales and use
taxes will continue to be collected.

FISCAL NOTE:  Estimated Effect on General Revenue Fund of a cost
of $1,297,148 to Unknown in FY 2007, a cost of $1,297,148 to
Unknown in FY 2008, and an income of $0 to a cost of Unknown in
FY 2009.  Estimated Cost on Other State Funds of $2,316,077 to
Unknown in FY 2007, $5,959,302 to Unknown in FY 2008, and
$7,226,450 to Unknown in FY 2009.

PROPONENTS:  Supporters say that there are over 60,000 jobs in
the auto industry in Missouri and many others that produce parts
used in the assembly plants.  The bill will help protect those
jobs by encouraging Missourians to purchase cars that are
assembled in this state.  The amount of money the customer saves
in sales tax will be spent on other goods and services.  The bill
will give an incentive to the auto industry to stay in Missouri
and train workers.  The average salary paid to an employee of an
auto assembly plant is well above that of other Missouri workers
and will be protected by the bill.

Testifying for the bill were Representatives Spreng and Richard;
Associated Industries of Missouri; Missouri Automobile Dealers
Association; DaimlerChrysler; Harley-Davidson Motor Company;
United Auto Workers-Missouri; United Auto Workers - Local 710;
and Missouri AFL-CIO.

OPPONENTS:  There was no opposition voiced to the committee.

OTHERS:  Others testifying on the bill say that it will have a
negative impact on the State Road Fund and the State Road Bond
Fund.  There are endless transportation needs in Missouri; and
anytime there is a reduction in the revenue received by the
state, transportation projects may be affected.  A reduction in
revenue will affect the Department of Transportation's ability to
complete projects on time or at all.

Others testifying on the bill was Department of Transportation.

Alice Hurley, Legislative Analyst

Missouri House of Representatives
93rd General Assembly, 2nd Regular Session
Last Updated November 29, 2006 at 9:42 am