Over the last few years, the Missouri Jobs and Prosperity Act has gone from an idea, to a Resolution that was passed out of the Governmental Accountability and Fiscal Oversight Committee, to an Act that was worked on and debated in the MO legislature, and by many groups, businesses and individuals across the state.

Before this joint resolution can go to Missouri voters for approval, it must receive a passing vote in the Senate and a passing vote in the House. To date, several Senate substitutes offered and debated since January of 2010 have made many structural improvements to the measure.

The Missouri Jobs & Prosperity Act (SJR29) focuses on one central message: to kick-start our economy by creating more incentive to keep what you earn. Many economists agree that the single largest factor driving a state’s economic growth policy can be whether or not they tax your income or earnings. The promise is huge: 20,000 net new jobs created each and every year after the transition from income to consumption taxes are made.

Why should Missouri eliminate the state income tax? Economist Dr. Art Laffer answers this question through his research on state competitiveness. He finds states without an income tax are far more competitive than high-tax states. He’s also able to show the volatility of collection over time of income taxes vs. sales taxes, which indicates that Missouri would see more stable, predictable state revenue by relying on a sales tax rather than an income tax.

And why should Missouri make this change now? An essay by Rex Sinquefield and Jack Naudi explains that Missouri is lagging behind the national average in employment growth over the last ten years, while the 9 states without an income tax have added jobs at more than double the national job growth rate during a similar period. They also compare Missouri to Tennessee: once, Missouri outpaced Tennessee in many economic indicators; but after 35 years without a state income tax Tennessee now has a higher per capita GDP, and a higher rate of net in-migration. Missouri has the potential for more growth than we are accomplishing today, and that costs us over time, and it costs Missourians jobs and earning opportunity. The longer we wait, the further we fall behind.

This isn’t an opportunity we can sit on forever. Other states looking for economic recovery, job creation and budget repair have access to the same information Missouri does, and may grasp that competitive advantage before we do. The Christian Science Monitor reports this week on the mass exodus of wealth from high-tax states:

The consequences of migration can be significant. Most people migrating from one state to another aren’t rich, but a good number are big-spending consumers, job-creating entrepreneurs, or philanthropists. One Boston College study found that New Jersey saw $168 billion in wealth walk out of the state from 2004 to 2008.

Many Missourians are starting to recognize that the Missouri Jobs and Prosperity Act is a significant job creation bill. This Tuesday, April 13th, hundreds of Missourians traveled to the Capitol for the Tax Day Tea Party to point lawmakers in the direction they want to head, including eliminating the state income tax. The rally got an update from Sen. Chuck Purgason and Rep. Ed Emery who have worked on this goal in the House and Senate. The rally’s keynote speaker, Michael Reagan, radio host and son of President Ronald Reagan, spoke of lessons he learned from his father.

Through Tea Party rallies across the state, Letters to the Editor, video, blogs, media coverage and social networking, an incredible amount of knowledge, research and news about the Missouri Jobs and Prosperity Act has been shared. It is vital that we press on past April 15th, and continue the conversations and the actions that move us toward the best possible Missouri economy. Follow the progress of the Missouri Jobs and Prosperity Act and learn about how you can get involved to achieve this goal by subscribing to the Americans For Prosperity – Missouri newsletter, Facebook or Twitter updates.

“Freedom is never more than one generation away from extinction. We didn’t pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same.”

– Ronald Reagan, 40th President of the United States

Workers in Kansas City are probably tackling RD-109, or RD-109NR for non-residents, while folks who live or work in St. Louis file Form E-1. Businesses also have to remit an earnings tax on profits. While many companies withhold the 1% tax for employees, any non-resident who worked part of the year outside the city may have overpaid, or may need to pay for work done inside city boundaries. In that case, filing becomes more difficult and it is up to the taxpayer to have documentation to support the dates he or she worked inside or outside the city.

These workers may soon have the opportunity to vote to sunset the city earnings tax. Here’s how that would happen:

The Let Voters Decide petition being circulated across Missouri will place language on the ballot that, if approved by voters, would trigger votes in Kansas City and St. Louis (the only cities in Missouri so far that levy a city earnings tax).

Current law doesn’t sunset the earnings tax, and for St. Louis and Kansas City residents it’s been 63 and 47 years respectively since they were engaged on this question of how best to raise city revenue. City economies, businesses, population, and industry have changed dramatically in the last half-century, so it is time to ask voters if the earnings tax is still the best way to raise revenue. Consider how often people get to vote on their local, state and federal elected officials, and that politicians are typically term-limited after 8 years. That opportunity to chart a different course, air new ideas, or simply reaffirm is what the Let Voters Decide petition aims to extend to Missouri voters.

The Let Voters Decide petition is gathering signatures across the state in order to qualify to place this language on the ballot. If Missouri voters approve that ballot initiative, it would prohibit new earnings taxes from being imposed on workers in communities that do not currently have one; and Kansas City and St. Louis voters would get a local vote every five years to decide if they would like to continue raising city revenue with the 1% earnings tax, or phase the tax out over a decade.

To learn more about Let Voters Decide, visit http://www.letvotersdecide.com, or connect on Facebook or Twitter.

The Missouri Chamber of Commerce and Industry, the Associated Industries of Missouri, and the Missouri Growth Association serve a variety of Missouri businesses and industries.

Small businesses employ about half of U.S. workers, and are responsible for 64% of net new jobs in the past 15 years [source]. Some organizations, like the MO Chapter of National Federation of Independent Business, just focus on Missouri small businesses and issues that they face.

The Missouri Department of Revenue is a constant resource for businesses or individuals looking for information or answers to questions about taxation and licensure, and for their annual report.

The Missouri Department of Economic Development looks at indicators of state economic growth in their Economic Conditions Report, and connects Missouri businesses with state resources.

A drive across the state reminds us that farming is a very important part of the equation for Missouri growth. The Missouri Farm Bureau Association looks closely at how farmers and Missouri’s strong agricultural sector will be affected by policies.

Part of Missouri’s health is attracting and retaining population and businesses. Missouri Association of Realtors is watching these trends closely.

These organizations are great resources for learning more about the economic status of Missouri, and getting a picture of the variety of indicators we can look at to move Missouri in the right direction.