Missouri Governor Signs Measure Lowering Missouri Income Tax Rates
Individual income tax rates in Missouri will drop in 2019 under a tax cut signed into law by Gov. Mike Parson on July 12. Under HB 2540, the top tax rate will decrease to 5.4 percent for the 2019 tax year.
This law will take effect on top of a 2014 law that enacted gradual cuts based on state revenue growth. Because the state has met revenue growth goals, the 5.9 percent top tax rate will drop to 5.8 percent in January. The new law Gov. Parson signed will bring the rate down another 0.4 percent, bringing the rate to 5.4 percent starting January 1, 2019. The rate will gradually decrease to 5.1 percent if the state continues to meet revenue goals.
The impact of these new provisions will vary from individual to individual. While the state is reducing the income tax rate, it is also phasing out the Missouri tax deduction for federal taxes paid.
For more information on how these changes may impact you, or for other state and local tax questions, please contact Pam Huelsman, Principal, Tax Services, at email@example.com.