Missouri businesses could gain extra tax incentives for choosing to expand in-state instead of elsewhere under a proposal outlined Tuesday by Gov. Jay Nixon.
Nixon's "Missouri First" initiative would allow the Department of Economic Development to exceed normal tax credit caps for established Missouri businesses that chose to expand.
The Democratic governor said Missouri's current tax incentives often make no distinction between longtime Missouri employers and out-of-state companies looking to relocate. In fact, he said, out-of-state firms sometimes can get more aid than existing Missouri businesses when factoring in specially built roads or other infrastructure.
"As we look for ways to create jobs and transform our economy, it's critical that we acknowledge and support businesses that are already making a difference by employing folks here in Missouri," Nixon said.
The proposal is to be considered during Missouri's annual legislative session that starts Wednesday and runs through mid-May.
Missouri's various tax credits typically have both a cap on how much can be awarded annually under each program and how much can be granted to a specific business. Businesses can get state incentives for job training programs, hiring additional employees or expanding their facilities.
Nixon is not seeking to raise the total amount of tax credits that can be awarded under each program. Rather, the governor said he wants to allow businesses that have been located in Missouri for at least five years to receive a greater share of the money.
Under the proposal, the Economic Development Department could increase the incentive cap for a particular business by up to 2 percent of the total incentive amount for each five-year increment the company has been Missouri. The extra incentives could equal as much as 10 percent of the total incentive for companies that have been in Missouri for 25 years or more.
One of the several programs affected is the Quality Jobs initiative, which was created in 2005. That program allows employers to earn a tax credit and keep a portion of the withholding taxes for newly hired workers who make average wages and receive health benefits. The amount of incentives a firm can receive annually varies by the size of the company.
The governor said the legislation would be sponsored in the Senate by John Griesheimer, R-Washington, and in the House by Tim Flook, R-Liberty, and Sam Komo, D-House Springs.