Senate committee hears legislation that would block state’s money grab of business unclaimed property

The Senate Governmental Affairs and Fiscal Oversight committee held a hearing on House Bill 1075, legislation sponsored by Rep. Rocky Miller,R-Tuscumbia, that would block the state’s false claims to business unclaimed property. The bill has been passed by the House and needs passage by the Senate to make its way to the governor’s desk.

“All too often, the unclaimed property that is being reported to the state isn’t truly unclaimed property,” said Tracy King, vice president of governmental affairs for the Missouri Chamber of Commerce and Industry. “This is not the state’s money, and it is not the state’s job to take these transactions and dump them into the general revenue.”

Some states have implemented aggressive strategies to target unclaimed business property because if the state can’t find the rightful owner of the property, the state can keep the property. The Council on State Taxation, a national tax association, began ranking states based on their unclaimed property laws in 2008.  While most of the states have made improvements over the years, Missouri has remained in the bottom-ranked states in the country with only Delaware, Mississippi and New York with lower rankings.

“House Bill 1075 would take Missouri from the bottom four states in the rankings to one of the top ten states for fair treatment of business unclaimed property,” King said.

The three main provisions of HB l075 would:

  • Create a business-to-business exemption for unclaimed property: Currently, if a business has outstanding credits or other transactions with another business, the state treasurer can audit the company and require them to pay into the state unclaimed property fund.
  • Establish a 3 year period of limitations:  There are statutes of limitations in both federal and state tax laws.  If a business files a report in good faith, they would be assured that they will not be subject to audit, resulting in penalties and interest.  The penalties and interest could be significant and the uncertainty would create considerable business planning risks. The statute of limitations defined in this bill is similar to the one for tax law.  The state would have three years after the filing of the report to audit the businesses’ records and to assess any addition property.
  • Provide a fair appeals process:  Currently, a business has little recourse if it disagrees with the Missouri Treasurer Office’s treatment of its unclaimed property.  Under this legislation, a business can appeal to a circuit court if it is unsatisfied with the treasurer’s ruling.

For more information on unclaimed property policy, contact Tracy King, Missouri Chamber vice president of governmental affairs, at tking@mochamber.com, or by phone at 73-634-3511.

House Committee explores uniform start date for public schools

In an effort to create a more standardized start date for schools across Missouri, this week the House Elementary and Secondary Education Committee held a public hearing on a bill that would create a uniform date for schools to open and close in Missouri.

House Bill 1139, sponsored by Rep. Steve Cookson (R-Poplar Bluff) would require that Missouri students in public schools attend for a minimum of 1,085 hours with no minimum of days. An amendment on the bill would also create a start date for schools that would be no earlier than August 25 of each year and the school year can end no later than May 31.

The bill also defines the terms of summer school programs, allowing them to be no more than 144 hours or six weeks. Neighboring states Arkansas and Iowa have enacted similar legislation.

The Missouri Chamber is supportive of this legislation and Tracy King, vice president of governmental affairs, testified on its behalf.

“We are strongly in favor of this bill, specifically the uniform start date,” King testified. “The impact on tourism and small business from losing part of their work force during the busy months is measurable. It is estimated the Missouri economy is losing $11.1 million annually due to the staggered start dates.

In 2003 a bill was passed by the legislature to create a uniform start date, but allowed an exception for any district that applied for an agricultural exemption. After the bill passed, 500 of the 526 Missouri school districts applied and were given the agricultural exemption.

Early school start dates create challenges for students, families and business. Families wanting to schedule vacations in late summer and rural families who have children involved in livestock and farming operations can be hindered by early school start dates.

No action was taken on the bill.

For more information about this issue, please contact Tracy King at tking@mochamber.com or by phone at 573-634-3511.

The Missouri Chamber holds that all taxpayers should be innocent until proven guilty – including large employers

This week, the Missouri Chamber’s Tracy King told a Senate committee that current Missouri tax policy denies Missouri large employers a basic right – innocence until proven guilty. The Missouri Chamber testified in support of legislation presented to the Senate Committee on Ways and Means that would shift the burden of proof in tax disputes from employer taxpayers to the Department of Revenue (DOR).

This bill is an enhancement to legislation passed in previous years that shifted the burden of proof from individuals and small businesses to the Revenue Department. The Missouri Chamber has been the lead proponent of this movement since the Missouri Legislature first looked at the issue in 1999.

The bill under review by the Senate committee is Senate Bill 829, sponsored by Sen. Will Kraus, a Republican from Lee’s Summit.

“The Missouri Chamber holds that innocence until proven guilty is an unconditional right of every Missouri taxpayer, including large employers,” King said. “I challenge the department to show me how they can draw a correlation between size of business and the frequency of tax evasion.”

Similar legislation was approved this week by the Missouri House Committee on Rules. That bill is House Bill 1455, sponsored by Rep. Denny Hoskins, a Republican from Warrensburg. That means HB 1455 could be debated as early as next week.

For more information on tax issues, contact Tracy King, Missouri Chamber vice president of governmental affairs, at tking@mochamber.com, or by phone at 573-634-3511.

Bill would give sellers the ability to absorb sales tax

It is currently illegal in Missouri for sellers to entice buyers with an offer to pick up the sales tax tab. But a bill heard in a House committee this week would allow this practice.

Under existing law, any business or individual offering an item for sale could be charged with a misdemeanor if they sold an item and paid the sales tax themselves instead of collecting the sales tax from the buyer.

House Bill 1296, sponsored by Rep. Andrew Koenig, R-Manchester, would allow these transactions to happen as long as the seller provided an invoice or receipt showing how the sales tax was absorbed into the total purchase price.

The Missouri Chamber of Commerce and Industry supports this change.

“This simple statute change would give sellers one more tool to help encourage business and stimulate sales while making it clear that the duty to pay sales taxes is being fulfilled,” said Tracy King, Missouri Chamber vice president of governmental affairs.

For more information about tax issues, please contact Tracy King, vice president of governmental affairs for the Missouri Chamber of Commerce and Industry at tking@mochamber.com or by phone at 573-634-3511.