Missouri tax credit program set to sunset unless reauthorized by General Assembly

The Missouri State Legislature has introduced House Bill 1007, a significant piece of legislation aimed at enhancing economic development through a new tax credit program. Introduced on April 9, 2025, the bill seeks to incentivize job creation and support businesses, particularly in distressed communities.

The primary purpose of House Bill 1007 is to establish a tax credit program that allows approved companies to receive tax credits in exchange for remitting a job development assessment fee. This fee, capped at five percent of gross wages for each eligible employee, increases to ten percent for projects located in distressed areas. The funds collected from these assessments will be used to retire bonds that finance economic development projects.

Key provisions of the bill include a sunset clause, which stipulates that the tax credit program will automatically expire on August 28, 2031, unless reauthorized by the General Assembly. If reauthorized, the program will sunset six years after the new effective date. Additionally, the bill ensures that taxpayers can still redeem tax credits authorized before the program's expiration.

Debate surrounding House Bill 1007 has focused on its potential economic impact and the allocation of tax credits. Critics express concerns about the bill's long-term sustainability and the possibility of overextending tax incentives without guaranteed job creation. Supporters argue that the program is essential for stimulating growth in economically disadvantaged areas and attracting new businesses to Missouri.

The bill includes a provision that reserves $950,000 annually for a specific project related to a world headquarters for a tax return preparation business in a large home rule city. This targeted investment aims to bolster local economies and create high-quality jobs.

As House Bill 1007 moves through the legislative process, its implications could be far-reaching. If successful, the program may lead to increased employment opportunities and economic revitalization in struggling communities. However, the effectiveness of the tax credits in achieving these goals will be closely monitored by both supporters and opponents as the bill progresses.