Issue Position: Job Creation and Economic Development

Issue Position

In 2011, one of Senator Schmitt's job-creating proposals, Senate Bill 19, became the first bill approved by the General Assembly and one of the first bills signed by the governor. This bill dealt with the corporate franchise tax, which is a tax based on a percentage of a company's assets. Corporations already pay taxes on their earned income as well as Missouri sales and property taxes. The franchise tax is a disincentive that penalized companies for investing in Missouri.

Senator Schmitt's legislation reduces and ultimately eliminates the heavy burden placed on businesses by this tax. Franchise tax liabilities are now capped at 2010 levels and will be phased out steadily over the next five years. By January 1, 2016, franchise tax liability will be eliminated, providing a much-needed boost to Missouri's businesses and allowing Missouri to compete more effectively for jobs. While Illinois is raising its taxes on businesses, Missouri is lowering the burden on businesses to give them the ability to expand and to create new jobs to put Missourians back to work. With the elimination of the franchise tax, Missouri will be poised to become a fertile ground for new businesses and allow existing businesses to expand more readily. Companies can now invest in hiring new employees instead of growing government through higher taxes.

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