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MissouriHB5942025 Regular SessionHouseWALLET

Relating to taxation

Sponsored By: Chad Perkins (Republican)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

10 provisions identified: 6 benefits, 0 costs, 4 mixed.

Investors get full capital gains subtraction

For tax years beginning January 1, 2025, or later, individuals can subtract 100% of federally reported capital-gain income. The subtraction reduces Missouri adjusted gross income for individuals subject to Missouri's individual income tax. It lowers state taxable income, not federal taxable income.

Fire districts trade sales and property taxes

Ambulance and fire districts can seek voter approval for sales taxes capped at 1%, up from 0.5%, with county-based exclusions removed. Districts must cut property-tax revenue by 50% of the prior year's sales-tax receipts and spend sales-tax money on ballot-listed purposes. Voters can petition to repeal the sales tax and restore the earlier property-tax levy. Signatures must come from at least 20% of registered district voters who voted in the last governor's election. Repeal requires majority approval among voters on the question and takes effect December 31 of the approval year.

Seniors keep property tax credit baseline

For eligible county property-tax credit recipients, a lower tax bill generally resets the credit's starting year for future calculations. The law prevents that reset when the drop comes solely from a levy reduction under section 321.554. This preserves the existing starting year in that case.

Shoppers pay less tax on hygiene products

Retail sales of diapers, incontinence products, and feminine hygiene products are exempt from Missouri's state sales tax. Buyers save the tax on qualifying purchases. Savings depend on how much they buy and the applicable tax rate.

City lodging taxes can support community centers

Charter cities over 100,000 residents in first-class charter counties can use lodging-tax money for community-center operating costs. This adds to allowed spending on tourism promotion, operation, and development. The rule applies to voter-approved lodging taxes of 5%–7%; the change does not itself impose a new tax.

Broadband providers get equipment tax exemption

For tax years beginning January 1, 2026, or later, broadband providers get a machinery and equipment tax exemption. It covers Missouri state and local sales and use taxes on equipment used to provide broadband service. Providers must give sellers a written exemption certificate. The direct savings go to providers, not household subscribers.

Business capital gains break gets trigger

Entities taxed under section 143.071 gain a subtraction for 100% of federally reported capital-gain income. It starts with tax years beginning January 1 after a year when Missouri's top individual tax rate reaches 4.5% or less. The law ties this business tax break to that rate trigger, rather than a fixed start date.

Counties can seek higher police taxes

Eligible counties can ask voters to approve a law-enforcement sales tax capped at 1%, up from 0.5%. First-class charter counties with more than 400,000 residents are excluded from that authority. Beginning August 28, 2025, a separate rule allows combined law-enforcement sales taxes under section 67.547 above 1%, capped at 1.5%. That rule covers counties with 8,001–8,899 residents and county seats with 731–799 residents; November 8, 2022, elections count as compliant at combined rates no higher than 1.5%. Adopted taxes raise shoppers' costs and provide money for law-enforcement services.

County lodging taxes cover more stays

County lodging taxes can cover sleeping rooms or cabins at bed-and-breakfast inns and campgrounds, alongside hotels and motels. The tax is capped at 6% per occupied room or cabin per night and funds only tourism promotion. Added eligible counties have 17,601–18,999 residents and county seats of either 4,001–5,049 or 8,001–9,999 residents. Counties taxing hotels and motels under this authority before August 28, 2025, can extend coverage without another vote. Covered transient stays—31 days or less in a calendar quarter—can cost guests more while providing tourism funding.

More cities can seek safety taxes

More cities and villages can seek voter-approved sales taxes capped at 0.5% for police, fire, and emergency medical services. Added places include villages of 431–479 partly in counties of 40,001–49,999 with county seats of 2,001–5,999. Added multi-county cities have 16,001–17,999 or 51,001–57,999 residents. Cities of 12,501–13,999 qualify in counties of 22,001–24,999 when they are the county seat or the seat has 901–1,399 residents; county-seat cities of 8,001–8,999 qualify in counties of 19,001–21,999. Adopted taxes increase shopping costs and fund equipment, staff pay and benefits, and facilities for these services.

Sponsors & Cosponsors

Sponsor

  • Chad Perkins

    Republican • House

Cosponsors

  • Ann Kelley

    Republican • House

  • Bill Irwin

    Republican • House

  • Bill Lucas

    Republican • House

  • Brian Seitz

    Republican • House

  • Deanna Self

    Republican • House

  • Ed Lewis

    Republican • House

  • John Hewkin

    Republican • House

  • Ron Fowler

    Republican • House

Roll Call Votes

All Roll Calls

Yes: 352 • No: 146

House vote • 5/7/2025

Reported Do Pass

Yes: 6 • No: 2

House vote • 5/7/2025

Truly Agreed To and Finally Passed

Yes: 102 • No: 41 • Other: 10

House vote • 5/7/2025

House Adopts - SS#2

Yes: 102 • No: 41 • Other: 10

Senate vote • 4/7/2025

Third Read and Passed

Yes: 27 • No: 6

House vote • 2/13/2025

Third Read and Passed

Yes: 100 • No: 48 • Other: 1

House vote • 2/13/2025

Reported Do Pass

Yes: 3 • No: 2

House vote • 2/6/2025

Reported Do Pass

Yes: 6 • No: 3

House vote • 1/29/2025

HCS Reported Do Pass

Yes: 6 • No: 3

Actions Timeline

  1. Delivered to Secretary of State (G)

    7/10/2025House

  2. Approved by Governor (G)

    7/10/2025House

  3. Delivered to Governor

    5/30/2025House

  4. Signed by President Pro Tem

    5/30/2025Senate

  5. Signed by House Speaker

    5/29/2025House

  6. House Message

    5/7/2025House

  7. Truly Agreed To and Finally Passed - AYES: 102 NOES: 41 PRESENT: 10

    5/7/2025House

  8. House Adopts - SS#2 AYES: 102 NOES: 41 PRESENT: 10

    5/7/2025House

  9. Taken Up

    5/7/2025House

  10. Reported Do Pass - AYES: 6 NOES: 2 PRESENT: 0

    5/7/2025House

  11. Voted Do Pass

    4/10/2025House

  12. Executive Session Completed

    4/10/2025House

  13. Referred: Fiscal Review

    4/7/2025House

  14. Reported to the House with... - SS#2

    4/7/2025House

  15. Third Read and Passed - AYES: 27 NOES: 6 PRESENT: 0

    4/7/2025Senate

  16. Taken Up

    4/7/2025Senate

  17. Reported Do Pass

    4/7/2025Senate

  18. Voted Do Pass

    4/7/2025Senate

  19. Executive Session Held

    4/7/2025Senate

  20. Executive Session Scheduled - Monday, April 7, 2025, 3:15 p.m., Senate Committee Room 2 - 1st Floor

    4/3/2025

  21. Referred: Fiscal Oversight

    4/2/2025Senate

  22. SS#2 Adopted

    4/2/2025Senate

  23. Taken Up

    4/2/2025Senate

  24. Placed on Informal Calendar - SS#2, Pending

    4/1/2025Senate

  25. SS#2 Offered

    4/1/2025Senate

Bill Text

  • Truly Agreed

    5/7/2025

    PDF

  • Perfected

    2/11/2025

    PDF

  • Committee Substitute

    1/29/2025

    PDF

  • Senate Substitute

    1/29/2025

    PDF

  • Introduced

    1/8/2025

    PDF

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