Missouri Voters Reject Income Tax Elimination

Voters in Missouri have blocked efforts to gradually eliminate the state’s individual income tax. This decision opposes the proposals promoted by Republican leaders and stands out against the trend of tax reductions in other GOP-led states. On Tuesday, the electorate firmly rejected Amendment 5, which sought to amend the state constitution to phase out Missouri’s income tax. This tax affects top earners with rates up to 4.7%. The amendment also aimed to give lawmakers more power to raise sales and other taxes to offset the lost revenue.

Additionally, voters were asked to decide on Amendment 4, which intended to make citizen-initiated constitutional changes more difficult. Proponents of Amendment 5 claimed it would boost Missouri’s competitiveness and help families retain more income. Opponents argued it would create budget issues and result in tax breaks for wealthier residents.

Scott Charton, a spokesman for opposition groups Missourians for Fair Governance and Missourians for Fair Taxation, remarked: “Amendments 4 and 5 have been buried so deep in citizen rejection, they should never come back,” as reported by the Missouri Independent.

Missouri’s Republican Governor Mike Kehoe, a leading advocate for eliminating the state’s income tax, expressed determination to continue his efforts despite the voter decision.

Missouri Voters Reject Tax Reform

Missourians decisively voted against the two amendments on Tuesday. Amendment 4 lost with 80% against and 20% in favor, while Amendment 5 was rejected by 83% of voters, according to The Associated Press. These outcomes preserve Missouri’s current tax framework and prevent any plans to replace income tax revenue through new or expanded sales taxes.

Missouri’s individual income tax generates over $9 billion annually, as highlighted in the Department of Revenue’s most recent report. This makes it the state’s largest source of revenue. Many groups questioned whether lawmakers could compensate for the budgetary shortfall if this tax were phased out.

Missourians for Fair Taxation stated in a fact sheet: “About two-thirds of Missouri’s general fund comes from state income tax. To replace revenue lost from phasing out the income tax, the largest possible source of new money comes from raising the current sales tax on goods such as groceries and gas. New sales taxes could also apply to everyday services, from haircuts to car repairs to healthcare.”

The setback for Governor Kehoe’s tax-reform agenda is notable, yet he remains dedicated to pursuing tax cuts. “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 posted on social media on Tuesday.

Missourians Buck GOP Tax Trend

Unlike many states where tax policies are legislated without constitutional changes, Missouri voters decided directly on their state’s income taxation strategy. As a result, Missouri continues alongside most states that heavily depend on income tax for funding government functions and services.

In recent years, however, Republican-led legislatures have implemented substantial income-tax reductions, altering their tax structures for long-term lower rates. For example, North Carolina’s Democratic Governor Josh Stein signed a $34 billion budget in early July, further reducing income taxes. This budget laid out a plan to cut the rate from 3.99% in 2026 to 3.49% next year, eventually reaching 2.99% by 2033. Other states like Mississippi, South Carolina, Kentucky, and West Virginia are progressing toward complete phase-outs of their income taxes.