(March 26, 2007) Rep. Shannon Cooper (R-120, Clinton, pictured at left) today added MEDC's priority legislation exempting cities from sales tax liability in Chapter 100 lease and sale arrangements to a larger sales tax exemption bill (HB 131). In December 2005, the Missouri Department of Revenue issued an opinion letter to the Department of Economic Development stating that leases and sales made by cities under Chapter 100 programs were subject to Missouri sales taxes. City governments and economic development professionals had believed such activities were consistent with the local governments' mission and that such transactions would be exempted under the constitution and Missouri statutes. As a result, cities did not collect sales taxes on these transactions. As news of the opinion letter circulated, our members found it more difficult to attract employers because of the sales tax liability and cities feared tax liability on projects already underway.
To resolve these questions, MEDC approached Rep. Cooper with legislation that would exempt sales and leases made by cities under Chapter 100 arrangements from sales tax, resulting in the amendment that was adopted today.
Rep. Cooper's actions have furthered MEDC's goal of passing the legislation this session and we sincerely thank him for his leadership and for his efforts on behalf of the MEDC.
To access more information about the bill, click here. The bill faces one more vote in the Missouri House before it may be sent to the Senate for further deliberation.
