Income tax repeal may hit Missouri ballot in '12

A group of prominent Missouri conservatives are moving forward with a ballot initiative in 2012 that would ask voters to repeal the state income tax, potentially forcing the issue to the forefront in the race for governor and U.S. Senate.

POLITICO has learned that Jefferson City lobbyist Travis Brown and wealthy conservative investor Rex Sinquefield will submit the initial paperwork for their dramatic plan to revise the state's tax system to the Secretary of State Friday.

Their initiative outlines nine different ways to eliminate the state's 6 percent income tax and replace it with a sales tax that does not exceed 7 percent.

Changing the tax system would require amending the state's constitution. That means attaining thousands of signatures by May of next year and winning a majority vote of the Missouri electorate in November 2012.

In an interview in Washington Thursday, Brown said Missouri's loss of a congressional seat is a timely example why public officials and residents should explore alternate ways to gain revenue and foster growth.

"People move to where the jobs really are and states that are experiencing high growth are often time states with lower tax models, lower tax burdens," he said, pointing to states like Texas and Tennessee, that do not have an income tax.

Eleven states currently do not tax income and Sinquefield cited a Show-Me Institute statistic that found that 75 percent of the gained seats in 2012 reapportionment went to states without an income tax.

Opponents have long argued that income tax repeals are fiscally reckless and irresponsible, leading to higher local taxes and drastic cuts in services. Another argument is that a sales tax unfairly burdens lower income people.

Brown said he was well-aware of that critique and noted one of the provisions would allow state lawmakers to define a lower income resident and provide appropriate economic relief.

Sinquefield said he had spoken with Gov. Jay Nixon about the plan once, "only in its most general terms . . . about two years ago."

"He gets a vote only as a citizen, not as a governor," Sinquefield said.

Nixon, along with Sen. Claire McCaskill, are both expected to face tough reelection battles in 2012.

Sinquefield, who donates generously to Republican candidates, said placing the issue before voters in 2012 would force politicians to confront it and even suggested President Obama could be compelled to weigh in.

"Even the president is probably going to have to take a position on this. He's going to try to win in Missouri," he said.

Added Brown: "It certainly seems like an important debate for everyone that's voting out there. We welcome other people of all political walks of life."

In 2006, a state ballot initiative protecting embryonic stem cell research became a hot-button issue in the Senate race. After much deliberation, Talent came out against the initiative and Michael J. Fox cut a late ad for McCaskill touting the benefits.

McCaskill defeated Talent 50 percent to 47 percent, a difference of just 48,000 out of 2.1 million cast.