As the deadline for filing annual tax returns approaches on Friday, Republican legislative leaders announced a plan to use $1 billion from the historical state surplus for tax refunds.
Under a bill introduced Monday, single filers would receive a $500 credit and married couples a $1,000 credit if they lived in the state for all of 2021. The credits would be issued after the start of the new fiscal year on July 1.
“As families struggle to make ends meet with the rising cost of inflation, it’s important that we do all we can to help them keep more of their hard-earned money,” said the chairman of the House Budget Committee, Cody Smith, R-Carthage, in a statement. Release. “The state is fortunate to have a record surplus, part of which we can use to provide direct economic relief to workers in Missouri.”
Under the bill, lawmakers $1 billion appropriate from the general revenue surplus that could reach $3.5 billion over the next year to appropriations. Each filer would receive a credit equal to their state tax liability.
It is not a refundable credit. The refund would only apply to the amount of tax owing and not to the full $500 or $1,000 if the taxes owing do not exceed that amount.
For the 2021 tax year, a single taxpayer taking the standard deduction has a liability of at least $500 if they earned $25,250 or more. A married couple filing a combined tax return with an income of approximately $44,500 has a tax liability of approximately $1,000.
The plan is backed by top GOP leaders in the Republican-dominated House, the statement said. House Speaker Rob Vescovo, R-Arnold, said he intends to make the bill a priority for lawmakers in the final weeks of the session.
All spending bills must be passed by May 6. No hearing has been set on the bill.