The St. Louis Argus believes an informed electorate is essential to a healthy democracy. Our responsibility is not to dictate how our readers should vote, but to provide clear information, examine competing arguments, and encourage voters to consider how public-policy decisions affect their families and communities. The Argus does not endorse candidates, and in examining ballot propositions, we seek to give our readers the information necessary to make their own informed decisions.
On August 4, Missouri voters will consider Amendment 5, a legislatively referred constitutional amendment that would establish a pathway toward eliminating Missouri’s individual income tax while allowing changes to sales and use taxes as part of the state’s transition to a different tax structure.
For Missourians confronting higher costs for housing, food, utilities, transportation, insurance, and other necessities, the prospect of keeping more of each paycheck understandably has appeal. Property-tax concerns have also become an important affordability issue for homeowners, particularly when assessments rise faster than household incomes. Amendment 5 therefore arrives at a time when the broader question of how much government taxes working families—and how those taxes are collected—is likely to resonate with voters.
The Argument In Favor
The strongest case for Amendment 5 is relatively straightforward: Missourians should be able to keep more of the income they earn, and reducing or eventually eliminating the state individual income tax could make Missouri more attractive to workers, retirees, entrepreneurs, and businesses.
This approach is not without precedent. States including Florida, Tennessee, Texas, South Dakota, and Wyoming operate without conventional individual income taxes. Supporters contend that eliminating taxes on earnings can encourage investment and economic activity and improve a state’s competitiveness when individuals and businesses decide where to locate.
For an individual taxpayer, the immediate benefit is easy to understand: eliminating a state income tax means wages that would otherwise be paid to the state remain with the taxpayer. That additional disposable income can potentially be spent, saved, invested, used to purchase a home, or circulated through local businesses.
There is also a philosophical argument. Income taxes tax economic earnings, while consumption taxes tax spending. Supporters of Amendment 5 may conclude that Missouri should rely less heavily on taxing earnings and allow residents greater control over how they use their income.
But There Is No Such Thing As A Tax-Free State
The critical question for voters is not simply whether they would like to eliminate the income tax. The harder question is: How will Missouri replace the revenue?
States without individual income taxes still finance schools, roads, public safety, health programs, corrections, and other government services. They simply collect revenue differently. Tennessee, for example, relies heavily on sales taxation. Texas has no individual income tax but relies on sales and property taxes. This illustrates the central cost-benefit calculation behind Amendment 5.
Potential benefits include increased take-home income, improved tax competitiveness, incentives for investment and entrepreneurship, and potentially greater economic attractiveness compared with states imposing higher income taxes.
Potential costs and risks include greater reliance on sales and consumption taxes, possible increases in taxes paid when purchasing goods or services, uncertainty over which transactions future legislatures might tax, and pressure on government services if replacement revenues fail to match the income-tax revenue being eliminated.
Missouri’s individual income tax provides a substantial portion of state general revenue. This is why the transition deserves careful scrutiny even by voters who strongly support reducing taxes.
History also provides a caution against assuming that every income-tax reduction automatically produces enough economic growth to replace lost revenue. Kansas enacted substantial income-tax cuts beginning in 2012 in an effort to stimulate its economy. Revenue shortfalls and fiscal pressures followed, and lawmakers ultimately reversed significant portions of the policy in 2017. Missouri’s proposal is not identical, but the experience demonstrates the importance of sequencing tax reductions carefully while maintaining sufficient revenue for essential services.
The Question Before Missouri
There is a legitimate argument that Missouri’s tax system deserves modernization and that reducing taxes on income could provide meaningful relief to working families while strengthening the state’s economic competitiveness. At a time when household budgets are under pressure, allowing residents to retain more of what they earn is an idea worthy of serious consideration.
At the same time, eliminating one tax does not eliminate the cost of government. Amendment 5 ultimately raises a broader policy question: Should Missouri shift away from taxing what residents earn and toward taxing more of what residents consume—and, if so, what safeguards should accompany that transition?
The answer may depend on whether voters believe the potential economic benefits of eliminating the income tax outweigh the risks associated with replacing billions of dollars in state revenue.
The Argus encourages voters to examine not only the promise of lower income taxes, but the complete tax equation. Ask what taxes may decrease. Ask what taxes could increase. Ask who benefits most. Ask who might pay more. And ask whether Missouri can protect education and essential public services throughout the transition.
For voters who believe Missouri should move toward a tax system that places less burden on earnings, Amendment 5 offers a pathway toward that objective and an opportunity to fundamentally reconsider how the state raises revenue. For voters concerned about shifting the tax burden toward consumption or granting lawmakers greater discretion over future sales taxes, the unanswered details may warrant greater caution.
Ultimately, the choice belongs to Missouri voters.
But whether voting yes or no, the most important thing is to understand that Amendment 5 is not simply a vote about eliminating a tax. It is a decision about what Missouri’s tax system should become after that tax is gone.
The Argus position remains that an informed vote is an empowered vote—and on August 4, Missouri voters will determine which path the state takes.
