Gov. Jay Nixon said Wednesday evening a Republican-backed tax cut sent to his desk reminded him of a similar measure he vetoed last year.
Nixon told reporters he was unhappy with Senate Bill 509, which passed the House of Representatives on a party-line vote just an hour earlier. The bill would gradually lower the state's highest income tax rate to 5.5 percent beginning in 2017 and phase in a 25 percent business income deduction. Budget researchers estimate the measure will cost the state almost $621 million in revenue once it is fully implemented.
Democrats including Nixon say the bill jeopardizes the state's ability to fully fund K-12 education. In addition, Nixon said the bill threatened the state's AAA credit rating.
"Once again, the General Assembly has voted to take money out of our public schools, hundreds of millions of dollars a year, and give it to some folks who just don't need it," he said.
The bill's sponsor, Sen. Will Kraus, R-Lee's Summit, told KRCG 13 he disputes that argument. Kraus pointed to a provision in the bill that states each year of the phase-in period, the next stage of reductions would not go into effect unless the state's revenue had gone up by at least $150 million.
"I don't see how that's going to jeopardize the AAA bond rating. If you take 750 minus 620, it's a plus," he said.
Nixon stopped short of threatening a veto, but he told reporters he thought SB 509 was very similar to House Bill 253, a tax cut which he vetoed last year. Republicans came close to overriding his veto. If Nixon vetoes SB 509, that would set up an override fight as the legislature tries to finalize the 2015 budget. The bill garnered 104 "yes" votes in the House and 23 in the Senate, which means Republicans would have enough votes to override a veto if everyone voted exactly the same way they did the first time the bill passed each chamber.