Missouri's Amendment 5 Could Shift Tax Burden to Middle Class

The Institute on Taxation and Economic Policy (ITEP) warns that the proposal would eliminate Missouri's individual income tax and force an expansion of sales taxes to cover the resulting revenue gap. For middle-class households earning between $50,000 and $80,000, this shift could mean an annual tax increase of $535. Conversely, the state's top 1%—those earning $689,300 or more—would receive an average tax break of $39,978.

Eli Byerly-Duke, an analyst at ITEP, notes the amendment offers no transparency regarding which services or goods would face new sales taxes to offset the loss of income tax revenue, which currently accounts for 64% of the state's general fund. Seniors and military families face the steepest consequences, as they already receive income tax exemptions on pensions and benefits. Without that income tax to reduce, they would see no benefit from the change while suffering the full impact of higher costs for daily necessities like groceries, gas, and healthcare.

Opposition groups, including Protect MO Taxpayers, argue the amendment would disproportionately harm rural Missourians, small businesses, and renters. The campaign supporting the measure, Missouri Promise PAC, has raised $9.6 million, much of it from dark money groups that shield their donors from public scrutiny. With the state government failing to specify how it intends to replace the lost income tax revenue, critics contend the proposal represents a significant gamble with the funding of essential state services like education and infrastructure.