Measure would have eliminated state’s 4.7% top income-tax rate

Missouri voters rejected the measure. The vote diverged from a broader trend: roughly two dozen Republican-led states have lowered their top income-tax rates since 2020. Mississippi and Oklahoma have put themselves on paths to eliminate personal income taxes entirely, and South Carolina is setting a course this year to drop its top rate to 1.99%.

With 83.3% opposed and 16.7% in favor, Missouri voters defeated the Republican-backed ballot measure that would have phased out the state’s graduated income tax, which carries a top rate of 4.7%.

The measure would have authorized state lawmakers to raise sales taxes and extend them to services Missouri does not currently tax, including television streaming and auto repairs. The Missouri Budget Project, a think tank, estimated that state sales-tax collections would need to grow from $3.3 billion to $11.8 billion annually to cover the resulting shortfall — a gap that could mean tripling the general sales-tax rate from 3% to 10.7%, or substantially expanding the range of purchases subject to sales tax, the group said in a report before the vote.

Republican Gov. Mike Kehoe, who backed the measure, said it was aimed at making the state more competitive. “I remain committed to working with the General Assembly in the years ahead on ways to continue cutting taxes, growing our state’s economy, and pursuing conservative policies that help Missouri families keep more of what they earn,” he said in a statement after the defeat.

Missouri Democrats had campaigned heavily against the measure, arguing that shifting the tax burden from income to sales taxes would fall hardest on working-class residents while delivering a large break to the wealthy. House Minority Leader Ashley Aune, a Democrat, said Wednesday that “Missouri voters just made clear they won’t let Republicans rewrite the rules to protect their own power and line the pockets of the ultrawealthy.”

Several Democratic-controlled states have moved in the opposite direction. Washington and Maine, among others, have pushed to increase taxes on top earners, citing the need to combat income inequality and plug budget holes they expect from Republicans’ cuts to federal health and nutrition assistance programs.