Corporate tax cuts and minimum wage increases take effect in Missouri

COLUMBIA, Mo. (KMIZ)

A new year brings new laws.

Missouri’s corporate tax cut is changing and it's unknown whether the state’s businesses will gain or lose money. And the cut has prompted worries from some corners that state revenue will drop -- and funding for education and other services along with it.

“It is part of a long term trend that we have seen in Missouri that is sort of a death by a thousand cuts," Missouri Budget Project spokeswoman Traci Gleason said. "Thus making it very difficult for our state to invest in its citizens.” 

Gleason said that without an educated and prosperous middle class, we’re not going to have a thriving economy.

The corporate tax rate dropped from 6.25 percent to 4 percent effective Wednesday. The Associated Press reported this week that the impacts on state revenue from the corporate tax cut are unclear because corporations based outside the state who do business here might end up paying more.

The state minimum wage is also increasing Jan. 1 -- from $8.60 per hour to $9.45. Downtown Columbia worker Shane Berliner, who said he makes a little more than the minimum wage, thinks the law will benefit some but could also pinch pocketbooks.

"I definitely think that increasing the minimum wage is going to be great for the community around here," said Berliner, a Rally House salesperson. "It’s definitely going to help out a lot of families that can’t really live off that minimum wage, but I think over time that inflation will catch up and will increase the price of everything, kind of hurting in the long run."

Gleason said when Missouri voters voted for the minimum wage increase they were looking out for the local economy, as families will be able to meet their basic needs.