1282S.05C
1
SENATE COMMITTEE SUBSTITUTE
FOR
SENATE JOINT RESOLUTIONS NOS. 31, 20, 24, 42, 32, & 48
JOINT RESOLUTION
Submitting to the qualified voters of Missouri, an
amendment repealing sections 20 and 26 of article X
of the Constitution of Missouri, and adopting four
new sections in lieu thereof relating to taxation.
Be it resolved by the Senate, the House of Representatives concurring therein:
That at the next general election to be held in the
state of Missouri, on Tuesday next following the first Monday
in November, 2026, or at a special election to be called by
the governor for that purpose, there is hereby submitted to
the qualified voters of this state, for adoption or
rejection, the following amendment to article X of the
Constitution of the state of Missouri:
Section A. Sections 20 and 26, article X, Constitution of
Missouri, are repealed and four new sections adopted in lie u
thereof, to be known as sections 1(a), 20, 20(a), and 26, to
read as follows:
Section 1(a). Beginning January 1, 2027, the Missouri
personal income tax shall no longer be imposed.
Section 20. 1. No expenses of state government s hall
be incurred in any fiscal year which exceed the sum of the
revenue limit established in sections 18 and 19 of this
article plus federal funds and any surplus from a previous
fiscal year.
2. (1) For all fiscal years beginning on or after
July 1, 2027, the appropriation authority of the general
assembly under Section 36 of Article III of this
Constitution shall be limited as provided under this
subsection. Except as provided under subsection 3 of this
section, the total amount of moneys of the Missouri state
2
government, excluding federal moneys, available for
appropriation each fiscal year shall be limited as follows:
(a) If the population of the state increased in the
most recent full calendar year by more than one percent from
the calendar year immediately preceding such calendar year,
the general assembly shall have a spending limit equal to
one hundred percent of the most recent year's appropriation
in which no appropriation is made under subsection 3 of this
section plus a corresponding amount based on the percentage
of the state population increase, which shall be applied as
a percent of the total moneys available for appropriation;
(b) If the population of the state increased in the
most recent full calendar ye ar by one percent or less from
the calendar year immediately preceding such calendar year,
the general assembly shall have a spending limit equal to
one hundred one percent of the most recent year's
appropriation in which no appropriation is made under
subsection 3 of this section; or
(c) If the population of the state decreased in the
most recent full calendar year, the general assembly shall
have a spending limit equal to one hundred percent of the
most recent year's appropriation in which n o appropriation
is made under subsection 3 of this section minus a
corresponding amount based on the percentage of the state
population decrease, which shall be applied as a percent of
the total moneys available for appropriation.
(2) When calculating the spending limitation on the
appropriation authority of the general assembly as provided
under this subsection, all deductions, exemptions, credits,
and other tax preferences issued in the previous fiscal year
shall be included in the calculati on of the spending
limitation.
3
3. (1) The spending limitation on the appropriation
authority of the general assembly under subsection 2 of this
section may be raised if the general assembly authorizes an
increase in the appropriation authority a s follows:
(a) If authorized by a two -thirds vote of the members
elected to and serving in each house, the spending
limitation on the appropriation authority of the general
assembly shall be equal to one hundred two percent of the
previous fiscal year's appropriation.
(b) If authorized by a three -fourths vote of the
members elected to and serving in each house, the spending
limitation shall be suspended, and there shall be no
limitation imposed on the appropriation authority of the
general assembly under the provisions of subsection 2 of
this section.
(2) If an increase is authorized under subdivision (1)
of this subsection, the authorized increase in the
appropriation authority or the authorized suspension of the
spending limitation shall remain in effect until rescinded
by a majority vote of the members elected to and serving in
each house or until the fiscal year affected by the
authorized increase has passed since the limitation was
raised, whichever occurs first.
Section 20(a). 1. (1) There is hereby established
within the state treasury a fund to be known as the "Tax
Reform Fund", which shall consist of moneys collected under
subsection 3 of this section. Moneys in the fund shall be
kept in a singular account to be expended pursuant to
appropriation by the general assembly if the conditions
under subsection 5 of this section are met and used solely
for the purposes described under subsection 5 of this
section and for no other purpose.
4
(2) The state treasurer shall invest moneys in the
fund in the same manner as other funds are invested. Any
interest and moneys earned on such investments shall be
credited to the fund.
(3) Subject to the provisions of subsection 5 of this
section, the unexpended balance in the tax reform fund at
the close of any fiscal year shall remain in the fund.
2. (1) There is hereby created in the state treasury
the "Budget Responsibility Fund", which shall consist of
moneys collected under subsection 3 of this section. Moneys
in the fund shall be kept in a singular account to be
expended pursuant to appropriation by the general assembly
if the conditions under subsection 5 of this section are met
and used solely for the purposes describ ed under subsection
5 of this section and for no other purpose.
(2) The state treasurer shall invest moneys in the
fund in the same manner as other funds are invested. Any
interest and moneys earned on such investments shall be
credited to the fund.
(3) Subject to the provisions of subsection 5 of this
section, the unexpended balance in the budget responsibility
fund at the close of any fiscal year shall remain in the
fund, except as provided under subdivision (4) of this
subsection.
(4) At the close of each fiscal year, if the budget
responsibility fund maintains a balance in an amount greater
than fifty percent of the immediately preceding fiscal year
balance of the general revenue fund, the amount in the
budget responsibilit y fund in excess of such fifty percent
amount shall be transferred to the strategic gold and silver
reserve fund established under subsection 6 of this section.
3. (1) For all fiscal years beginning on or after
July 1, 2027, if the amount of net general revenue
5
collections, as defined under Section 27(a) of Article IV of
this constitution, exceeds the anticipated general fund
revenue expenditures for a fiscal year by one million
dollars or more, each fiscal year that such surplus is
realized:
(a) Fifty percent of the moneys arising from such
surplus shall be deposited into the tax reform fund; and
(b) Fifty percent shall be deposited in the budget
responsibility fund.
(2) The budget responsibility fund shall continue to
collect revenue and shall be used only as described under
subsection 5 of this section.
(3) The tax reform fund shall continue to collect
revenue and shall be used only as described under subsection
5 of this section, subject to the provisions of su bsection 4
of this section.
(4) The general assembly may appropriate funds to the
credit of the tax reform fund and the budget responsibility
fund.
4. (1) Initially, the general assembly shall
exclusively utilize the tax reform fund to gra dually reduce
the state sales tax rate. In a subsequent year where a
surplus of one million dollars or more is realized in the
general revenue fund at the close of the fiscal year, a
state sales tax decrease trigger of one -hundredth of one
percent or greater shall go into effect for every forty -five
million dollars in the tax reform fund. There shall be no
limit on the number of reductions authorized under this
subdivision and such decreases shall remain in effect until
the state sales tax is red uced to four percent. Upon the
state sales tax rate reaching four percent, the state sales
tax rate shall not exceed four percent.
6
(2) Upon the reduction of the state sales tax rate to
four percent or less, the tax reform fund shall be
exclusively used to gradually reduce and eliminate the
corporate income tax rate. In a subsequent year where a
surplus of one million dollars or more is realized in the
general revenue fund at the close of the fiscal year, a
corporate income tax decrease trigge r of one-fifth of one
percent or greater shall go into effect for every forty -five
million dollars in the tax reform fund. There shall be no
limit on the number of reductions authorized under this
subdivision and such decreases shall remain in effect until
the corporate income tax is reduced to zero.
(3) Upon the reduction of the state sales tax rate to
four percent or less and the elimination of the corporate
income tax, the remaining balance of the tax reform fund
shall be transferred to th e strategic gold and silver
reserve fund, as established and defined in subsection 6 of
this section, and the tax reform fund shall be abolished.
5. (1) If the state experiences a budgetary shortfall
in the next fiscal year immediately succeeding the
implementation of a tax decrease, the tax reform fund may be
used during the immediately succeeding appropriation period
to supplement areas of necessary funding in the order of the
general assembly's authorized appropriations priority for
the next fiscal year's budget. The moneys from the fund
that may be used for such supplemental funding shall be in
an amount not to exceed the lesser of that year's budgetary
shortfall or the total loss in net general revenue
collections in the fiscal year of the budgetary shortfall as
a result of decreased collections due to the general
assembly enacting a tax reduction in the previous fiscal
year.
7
(2) The general assembly may authorize the use of the
budget responsibility fund by a two -thirds vote of the
members elected to and serving in each house, subject to
subsections 2 and 3 of section 20 of this article.
6. (1) There is hereby created in the state treasury
the "Strategic Gold & Silver Reserve Fund", which shall
consist of moneys collected under subsections 2, 3, and 4 of
this section and any other moneys as the general assembly
may appropriate, subject to the conditions established under
this section.
(2) The total of the balance in the tax reform fund
shall be transferred to the strategic gold and silver
reserve fund as provided under subdivision (3) of subsection
4 of this section. After such transfer, the strategic gold
and silver reserve fund shall consist of moneys collected
under subsection 3 of this section in the same manner as the
tax reform fund.
(3) Each fiscal year that the balance of the budget
responsibility fund meets the conditions to exceed the
amount calculated under the provisions of subdivision (4) of
subsection 2 of this section, such exc ess amount shall be
transferred from the budget responsibility fund to the
strategic gold and silver reserve fund.
(4) Moneys in the strategic gold and silver reserve
fund shall be kept in an account and expended each year
solely for the purpose of purchasing gold or silver and the
management, storage, or security thereof, and once
purchased, such gold or silver shall be physically kept
within the borders of the state of Missouri at a depository
approved for the holding of state purchased prec ious
metals. Gold and silver within the possession of the
strategic gold and silver reserve shall not be sold,
liquidated, or transferred to the custody of any entity that
8
is not the state of Missouri without a constitutional
amendment modifying this subsection. Nor shall it be used
as collateral against any loans.
7. The general assembly shall enact such laws as may
be necessary to carry out the provisions of this section.
Section 26. 1. In order to prohibit an increase in
the tax burden on the citizens of Missouri, [state and]
local sales and use taxes (or any similar transaction -based
tax) shall not be expanded to impose taxes on any service or
transaction that was not subject to sales, use or similar
transaction-based tax on January 1, 2015.
2. Upon the reduction of the state sales tax rate to
four percent or less by general law, the total rate of state
sales tax imposed by general law and any additional state
sales tax imposed under this constitution, but ex cluding the
state sales taxes imposed under subsection 3 of this
section, subdivision (1) of subsection 4 of section 1 of
article XIV of this constitution, and subdivision (1) of
subsection 6 of section 2 of article XIV of this
constitution, shall be capped at a rate not to exceed four
percent, levied and imposed upon all sellers for the selling
of tangible personal property or rendering taxable services
at retail in this state upon the sales and services that now
are or hereafter are listed and se t forth in, and except as
to the amount of tax, subject to the provisions of and to be
collected as provided in the "Sales Tax Law" and subject to
the rules and regulations promulgated in connection
therewith.
3. An additional state sales tax is levied for the
rendering of lobbying services in this state. The tax shall
be at a rate equivalent to six percent.
Section B. Pursuant to chapter 116, and other
applicable constitutional provisions and laws of this state
9
allowing the general assembly to adopt ballot language for
the submission of this joint resolution to the voters of
this state, the official summary statement of this
resolution shall be as follows:
"Shall the Missouri Constitution be amended to
eliminate the personal income tax; impose a spending limit
on the General Assembly; create surplus revenue funds for
reducing certain taxes, supplementing budgets, and buying
gold and silver; repeal the prohibition on certain sales and
use taxes; cap the state sales tax rate; and impose a tax on
lobbying services?".