Tax Freedom Day Arrived on April 18th in Missouri
Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2006, Missouri taxpayers had to work until April 18th (ranked 35th nationally) to pay their total tax bill, over a week earlier than the national Tax Freedom Day (April 26th).

Missouri’s State/Local Tax Burden Below Average
During the last three decades Missouri’s state and local tax burden has consistently been well below the national average. Estimated at 9.9% of income, Missouri’s state/local tax burden percentage ranks 34th highest nationally, well below the national average of 10.6%. Taxpayers in Missouri pay $3,509 per-capita in state and local taxes.

Missouri’s 2007 Business Tax Climate Ranks 15th
Missouri ranks 15th in the Tax Foundation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property. Neighboring states ranked as follows: Iowa (43rd), Nebraska (44th), Kansas (31st), Oklahoma (21st), Arkansas (35th), Tennessee (18th), Kentucky (39th) and Illinois (25th).

Missouri’s Individual Income Tax System
Missouri’s personal income tax system features ten separate income brackets, which is the most out of any state in the nation. The top rate of 6% kicks in at a relatively low income level of $9,000. Among states levying personal income taxes, Missouri’s top rate of 6.0% is 24th highest. Missouri's 2004 individual income tax collections were $700 per person, which ranked 23rd highest nationally.

Missouri’s Corporate Income Tax System
Missouri’s corporate tax structure consists of a flat rate of 6.25% on all corporate income. Among states levying corporate income taxes, Missouri's top rate ranks the state 36th highest. In 2004, corporate tax collections were $39 per capita, ranking the state 7th lowest nationally.

Missouri Levies Nation's 10th Lowest Sales Tax; Gasoline and Cigarette Taxes among Lowest Nationally
Missouri levies a 4.225% sales tax on transactions, which is 10th lowest nationally. In fiscal year 2004, state and local governments combined collected $807 per person in sales taxes, which is ranked 23rd highest nationally. Missouri’s gasoline tax stands at 17 cents per gallon, ranking 7th lowest nationally. The state's cigarette tax stands at 17 cents per pack of twenty, which is 2nd lowest nationally. The sales tax was adopted in 1934, the gasoline tax in 1925 and the cigarette tax in 1955.

Missouri Property Taxes: Comparatively Low
Missouri is one of the 37 states that collect property taxes at both the state and local levels. As in most states, local governments collect far more. Missouri's localities collected $4,281,624,000 in property taxes in fiscal year 2004, which is the latest year the Census Bureau published state-by-state property tax collections.& At the state level, Missouri collected $22,763,000 in property taxes during FY 2004, making its combined state/local property taxes $4,304,387,000. That brings its per capita collection to $747, ranking 37th highest nationally.

Federal Tax Burdens and Expenditures: Missouri is a Beneficiary State:
Compared to the average state, Missouri taxpayers receive more in federal funding per dollar of federal taxes paid. In 2004, Missouri citizens received approximately $1.29 in the way of federal spending. This ranks the state 20th highest nationally and represents a slight rise from 1992 when Missouri received $1.25 per dollar of taxes in federal spending, ranking17th highest nationally.

Source: The Tax Foundation

Missouri Income Tax
The tax rate for individuals ranges from 1.5% on the first $1,000 of taxable income to 6% of taxable income over $9,000. Missouri taxable income is reduced by the amounts of various standard and itemized deductions. The standard deductions include: a portion of federal income tax paid (up to $5,000 on a single return and $10,000 on a joint return), $1,200 for each dependent, $2,100 for each personal exemption, as well as the federal standard deduction for a married couple filing jointly who does not itemize deductions.

Missouri Tax Rate

Missouri Corporate Income Tax
According to the Tax Foundation, Missouri's per capita state and local tax burden averages 9.4% of income in 2005, which is less than the United States average of 10.1%.

Missouri corporate income tax is based on federal taxable income with adjustments for state income taxes, interest from exempt federal obligations, and other less common adjustments.

The tax rate for corporations is 6.25% applied to Missouri taxable income. In addition, Missouri allows 50% of federal income tax payments to be deducted before computing taxable income. Using the deduction, a corporation with a taxable income of $1 million would have a Missouri effective tax rate of only 5.2%. Estimates must be filed and quarterly payments made, if the tax is reasonably expected to exceed $250.

For corporations conducting business both inside and outside Missouri, only income earned in Missouri is taxed. Two allocation options are offered for calculating this income: 1) a single-factor formula based on sales, or 2) a three-factor formula based on property, payroll, and sales. Missouri is the only state that permits companies to choose the formula that results in the lesser corporate income tax liability.

Missouri Sales Tax
The state of Missouri levies a 4.225% sales/use tax on purchases other than retail sales of food. Food is taxed by the state at 1.225%. The sales tax is applied to all retail purchases plus taxable services such as utilities sold at retail to the consumer. SW MO counties and local municipalities impose levies as well. Local county and municipal sales taxes apply to food as well as other retail purchases.
If the sale or use of property has already been subject to a tax of less than 4.225% by any state, then the tax is the difference between 4.225% and the tax that has already been imposed.

Southwest Missouri

Sales Tax

City
(Total = City + County + State Sales Tax Rates)

Missouri Property Tax
The State Tax Commission of Missouri is the agency charged with overseeing Missouri's property tax system
The local property tax rate is an aggregate of school, city, county, and state levies expressed as tax per $100 of assessed valuation. Property is assessed on the basis of "fair or true market value." All property, real and tangible personal, is taxable unless expressly exempt. Examples of exemptions include:

• Inventories of retail merchants, manufacturers, and wholesalers, including raw materials and goods in process.
• Property “actually and regularly used exclusively” by an exempt organization pursuant to its exempt purposes and not held for private or corporate profit

Assessment Ratios

• Commercial and industrial real property is assessed at 32% of fair market value.
• Tangible personal property, not elsewhere classified, is assessed at 33 1/3% of fair market value.
• Residential property is assessed at 19% of fair market value.
• Agricultural property is assessed at 12% of fair market value

Real Property
All property is appraised at its fair or true market value by the county. Commercial and industrial real property (i.e., land and buildings) is assessed an additional county surcharge designed to replace revenue losses attributable to the tax exemption of business inventories.

Tangible Personal Property
Assessed values of tangible personal property in Missouri are set at 33 1/3% of fair or true market value. Most counties in the metropolitan area use formulas under which original costs of depreciable personal property are discounted to determine true values. Tangible personal property includes machinery and equipment.

Intangible Personal Property
There is no tax on intangible personal property.

Non-Business Personal Property
The state has authorized local governments to apply a tax based on the actual cash value of licensed motor vehicles (automobiles, trucks, motorcycles), boats, motors, trailers and campers. The assessment ratio for this type of property is 33 1/3%. The assessment ratio for livestock is 12% and 0.05% for grain and crops.

Southwest Missouri
Property Tax Rates (includes City, County, & State rates)
Per $100 of assessed value: