The Everything Tax, Explained.

Here's What You Will See On The Ballot

The Ballot Summary Statement

Shall the Missouri Constitution be amended to:

• Require legislative phase-out of the individual state income tax based on revenue growth, and authorize the expansion of sales and use taxes;
• Curtail constitutional limits on taxing goods and services; and
• Require local tax rate cuts without reducing school funding if local sales tax revenue increases?

The "Fair Ballot Language Statement"

A "yes" vote will amend the Missouri Constitution to require legislative phase-out and elimination of the individual state income tax based on revenue growth, and authorize the expansion of sales and use taxes; curtail constitutional limits on taxing goods and services; and require local tax rate cuts without reducing school funding if local sales tax revenue increases.

A "no" vote will not amend the Missouri Constitution to require legislative phase-out and elimination of the individual state income tax based on revenue growth; and will not authorize the expansion of sales and use taxes.

At this time, the impact on taxes is unknown.

What It Actually Does

When the limited Ballot Summary says Amendment 5 will "Require legislative phase-out of the individual state income tax based on revenue growth, and authorize the expansion of sales and use taxes," it means:

• In order to fill the revenue hole from getting rid of the state income tax, politicians will have authority to raise current sales and use tax rates for goods ranging from groceries to gas, and expand a new sales tax to everyday services, from haircuts to car repairs to health care.

The limited Ballot Summary also says Amendment 5 will "Curtail constitutional limits on taxing goods and services."

This means the politicians can ignore current taxpayer protections that Missourians voted to put into the constitution over the last half century.

Amendment 5 gives politicians a blank check to raise the sales tax to an average of 16% on everything you buy — including services that have never been taxed before in Missouri history.

The Ballot Title says: "At this time, the impact on taxes is unknown." This is because the Legislature and the State Auditor realize Amendment 5's cancellation of constitutional taxpayer safeguards mean new taxes could go sky-high — the biggest tax increase in Missouri history. The final total tax increase is anyone's guess, but the nonpartisan Missouri Budget Project estimates 80% of Missourians will see increased state taxes because of Amendment 5.

The Constitutional Protections It Overrides

• The constitution's current Hancock Amendment requires you get a vote on big tax increases — but Amendment 5 lets politicians raise taxes without asking for your permission.
• In 2010, 83.7% of the voters approved a constitutional ban on taxing the buying or selling of homes — but Amendment 5 lets politicians ignore that ban and tax property purchases and sales, putting the American Dream of home ownership further out of reach.
• In 2016, Missourians approved banning new sales taxes on services we use every day, but Amendment 5 puts a new sales tax on services.

Who Benefits, Who Pays

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 your groceries and gas, plus adding a new sales tax on services you use every day, from haircuts to car repairs to health care.

The nonpartisan Missouri Budget Project estimates that the average state and local sales tax combined will triple, to about 16% on everything you buy. That is why Amendment 5 is The Everything Tax.

Income tax cuts help the most wealthy, while sales tax increases hit hardest for those with lower incomes, such as working families, senior citizens, retirees, veterans and disabled persons. The Missouri Budget Project estimates 80% of Missourians will pay more in taxes under Amendment 5 — an average tax increase of $500 per family.