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Missouri has the Thirteenth Lowest State and Local Tax Burden in the Nation for FY 2016

May 09, 2018

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In Fiscal Year (FY) 2016, Missouri collected $22.6 billion in state and local taxes—or $3,717 for every man, woman, and child. While this is an impressive sum of money, it tells us little about whether or not the average Missouri taxpayer can afford this level of taxation?

 

To better answer this question, this analysis will calculate Missouri’s tax burden relative to the private sector. Ultimately, it is the private sector that creates new wealth and income. A high tax burden means a state is hobbling its private sector relative to other states and reducing their long-run economic growth potential.

 

 

Click here to view tax burden data by state, type of tax, and for years 1950 to 2016

 

Fortunately for taxpayers, as shown in Chart 1, Missouri’s state and local tax burden (tax collections divided by private sector personal income) was the thirteenth lowest in the nation for FY 2016 at 12.8 percent—or -11 percent below the national average of 14.3 percent.

 

Chart 1 Missouri State and Local Tax Burden FY 2016.jpg

 

#Missouri state and local #taxburden in FY 2016 was the 13th lowest in the nation at 12.8%— -11% below US average of 14.3% http://bit.ly/2FX9C8F @keypolicydata #MOpol #MOleg #MOsen #MOgov #PolicyData (click to tweet)

 

As shown in Chart 2, Missouri’s tax burden has increased over time by 86 percent to 12.8 percent in FY 2016 from 6.8 percent in FY 1950.

 

Chart 2 Missouri State and Local Tax Burden by Type of Tax FY 1950 to 2016.JPG

 

#Missouri state and local #taxburden has increased 84% between FY 1950 (6.8%) to 2016 (12.8%) http://bit.ly/2FX9C8F @keypolicydata #MOpol #MOleg #MOsen #MOgov #PolicyData (click to tweet)

 

Click here to view tax burden data by state, type of tax, and for years 1950 to 2016

 

 

As shown in Chart 3, Missouri’s 12.8 percent tax burden is greater than manufacturing (11.7 percent)

 

Chart 3 Missouri State and Local Tax Burden vs. Major Industry FY 2016.JPG

 

#Missouri state and local #taxburden > manufacturing http://bit.ly/2FX9C8F @keypolicydata #MOpol #MOleg #MOsen #MOgov #PolicyData (click to tweet)

 

Missouri’s lower than average state and local tax burden is driven by a low corporate income tax burden (0.2 percent, 8th lowest), property tax burden (3.4 percent, 12th lowest), and all other taxes burden (1.8 percent, 16th lowest).

 

Additionally, Missouri taxpayers have the benefit of the Hancock Amendment which was added to the Missouri Constitution in 1980. The amendment caps revenue to 5.6959 percent of personal income. Any revenue exceeding the cap must be refunded to the taxpayers.


Here is one of my earliest studies I wrote and deals with the Hancock Amendment that I did while working for the Tax Foundation (pdf) and here is a more technical review of the Hancock Amendment from the Institute of Public Policy at the University of Missouri (pdf).

 

Of course, the tax burdens for local government can vary just as much as they do among the 50 states. As such, we have also calculated the local government tax burden for every county in Missouri—this includes every taxing jurisdiction within the geographic county borders whether it is a city, a special district, or county government itself.

 

The 20 Missouri counties with the highest local government tax burden include:

 

  • St. Louis (Independent City), MO (14.5 percent)
  • Douglas County, MO (10.7 percent)
  • Macon County, MO (10.1 percent)
  • Putnam County, MO (9.8 percent)
  • Jackson County, MO (9.8 percent)
  • Taney County, MO (9.8 percent)
  • Reynolds County, MO (9.3 percent)
  • Cole County, MO (8.6 percent)
  • Miller County, MO (8.4 percent)
  • Johnson County, MO (8.2 percent)
  • Pulaski County, MO (8.0 percent)
  • Iron County, MO (7.9 percent)
  • Nodaway County, MO (7.7 percent)
  • Camden County, MO (7.3 percent)
  • New Madrid County, MO (7.3 percent)
  • Buchanan County, MO (6.9 percent)
  • Texas County, MO (6.8 percent)
  • St. Francois County, M (6.8 percent)
  • Randolph County, MO (6.8 percent)
  • Adair County, MO (6.7 percent)

 

The 20 Missouri counties with the lowest local government tax burden include:

 

  • Laclede County, MO (4.0 percent)
  • Ray County, MO (3.9 percent)
  • Polk County, MO (3.9 percent)
  • Dallas County, MO (3.9 percent)
  • Lincoln County, MO (3.8 percent)
  • Clinton County, MO (3.8 percent)
  • Moniteau County, MO (3.8 percent)
  • Callaway County, MO (3.7 percent)
  • Carroll County, MO (3.7 percent)
  • Morgan County, MO (3.7 percent)
  • Bollinger County, MO (3.6 percent)
  • Ripley County, MO (3.5 percent)
  • Stoddard County, MO (3.5 percent)
  • Crawford County, MO (3.4 percent)
  • Christian County, MO (3.4 percent)
  • Shannon County, MO (3.1 percent)
  • Newton County, MO (2.9 percent)
  • Webster County, MO (2.9 percent)
  • Ralls County, MO (2.4 percent)
  • Osage County, MO (2.3 percent)

 

Chart 4 Missouri Local Tax Burden by County FY 2016.JPG

 

Click here to view tax burden data by state, type of tax, and for years 1950 to 2016

 

Finally, don’t forget to watch our exclusive time-lapse video of state and local tax burdens over the last 66 years! See if your state has been above or below the national average?

 

 

 

 


Category: Tax Burdens

J. Scott Moody

Scott has nearly 20 years of experience as a public policy economist. He is the author, co-author and editor of over 180 studies and books. His professional experience also includes positions at the American Conservative Union Foundation, Granite Institute, Federalism In Action, Maine Heritage Policy Center, Tax Foundation, and Heritage Foundation.


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