AIM Passes Priority Tax Legislation - ICC/Music City

April 28, 2010 - AIM President Ray McCarty announced early this afternoon the Missouri House has finally passed SB 928, a top tax legislative priority of Associated Industries of Missouri.

"This bill corrects a misguided decision of the Missouri Supreme Court that would have resulted in a tax increase to be paid by all businesses selling goods and services to exempt organizations such as churches, government organizations, charities, and other exempt organizations," said McCarty. "Supreme Court justices were, in effect, legislating from the bench in enacting what amounts to a tax increase on those businesses that sell to these types of organizations. By their action today, the Missouri General Assembly rejected this judicial tax increase and we are thankful for their support."

Under the decision, businesses selling to these organizations and government entities would be responsible for paying tax on the purchase price of the items sold to those entities. This would increase costs for these businesses and result in higher costs for schools, government, churches, etc.

Associated Industries of Missouri began working to correct this problem as soon as the decision became final and the true impact of the decision was known. The AIM Tax Committee was instrumental in providing the expertise necessary to draft language that would, after many months of negotiation, be acceptable to the Missouri Department of Revenue in overturning this decision. Special thanks to Andy Zellars, Todd Iveson, and Trevor Bossert of the DOR, Rich Germinder of Senator Lager's office, and Jacinda Walters in Rep. Sutherland's office, who were very helpful in this effort.

The bill also addresses a similar decision relating to ticket sales.

The bill was sponsored by Senator Brad Lager, (R-12 Savannah, pictured above) and the bill was handled in the House by Representative Mike Sutherland, (R-99, Warrenton, pictured at left) - both long-standing supporters of Missouri business. WE THANK SENATOR LAGER AND REP. SUTHERLAND FOR THEIR LEADERSHIP IN FILING AND SHEPHERDING THIS BILL THROUGH THE LEGISLATIVE PROCESS. Governor Nixon is expected to sign the bill soon.

Click here for more information regarding SB 928.

Nixon Appoints Barragan-Scott Director of Revenue

October 16, 2009 - Governor Jay Nixon today appointed Alana Barragan-Scott to the position of Director of Revenue. Barragan-Scott served most recently as acting Director of Revenue and previously as General Counsel to the Department of Revenue. Her appointment is subject to Senate confirmation. We met with Alana in her role as acting Director and believe Governor Nixon has made a sound choice in her appointment as Director of Revenue.

Here is the press release by Governor Nixon:
http://governor.mo.gov/newsroom/2009/Alana_Scott

Nixon Appoints Mitchell to Judgeship - Alana Barragan-Scott Named Acting Director of Revenue

September 3, 2009 - On July 9, 2009, Governor Jay Nixon appointed Director of Revenue Karen King Mitchell to the Missouri Court of Appeals, Western District. Click here for the Governor's announcement.

The governor appointed Alana Barragan-Scott to the position of Acting Director of Revenue.

Chris Cudney, chair of the AIM/TRIM Tax Committee, Marc Ellinger, of Blitz, Bardgett and Deutsch and chairman of the AIM Board of Directors, and I recently met with the new acting director and the acting director of the Division of Taxation, Todd Iveson. The meeting produced an agreement to continue meetings started by the AIM/TRIM Tax Committee a couple of years ago that focus on efficiency measures and help increase understanding between taxpayers and the DOR.

Congratulations to Judge Mitchell and to Acting Director Barragan-Scott!

Governor-Elect Jay Nixon Names Director of Revenue: Karen K. Mitchell

December 20, 2008 - Governor-elect Jay Nixon has his intention to name Karen K. Mitchell as the next Director of Revenue.

Ms. Mitchell, 50, currently serves as the Chief Deputy Attorney General, a position she has held since February, 1999. She graduated with a bachelors degree from the University of Missouri in 1981 and graduated from the University of Missouri - Kansas City law school in 1984. She is a recipient of the Missouri Bar Foundation Award for Outstanding Appellate Advocacy and the Ray Marvin Award, which recognizes outstanding assistant attorneys general nationally.

“During these challenging economic times, we must have a Director of Revenue who understands state government and has fresh ideas about how to make the Department more efficient, effective and responsive to the needs of Missourians,” Gov.-elect Nixon said. “I’ve worked closely with Karen Mitchell for the past 16 years, and I couldn’t ask for a better manager and professional to assume this important position in my administration. As Governor, I plan to revolutionize how the Department of Revenue does business, ending the system of political patronage for license fee offices and bringing many motor vehicle transactions online. Karen has been instrumental in developing these plans, and I know she’ll do an excellent job putting them into action. Together, we’re going to save money and improve service for Missourians.”

“Gov.-elect Nixon is committed to moving the Department of Revenue and the entire state government in a new direction, and I’m honored to have this opportunity to help bring about real change for Missourians,” Ms. Mitchell said. “From Day One, we’re going to hit the ground running. We’ll start the process of competitively bidding all the state’s license fee offices and expanding online services. As the national economic crisis continues, we’re going to use taxpayer dollars responsibly, and we will look for additional opportunities to save time and money for Missouri families. I look forward to continuing my career in public service under Gov.-elect Nixon’s administration.”

"Associated Industries of Missouri congratulates and welcomes Ms. Mitchell and we look forward to working with her to continue to achieve efficiencies in tax operations through informal meetings with the Department," said Ray McCarty, president of AIM and executive director of the Taxpayers Research Institute of Missouri. "These meetings have resulted in savings through elimination of unnecessary processes in the Departments of Revenue and Natural Resources and have increased cooperation between taxpayers and the tax collection department."

Official Withdrawal of State Tax Add Back Rule

November 5, 2008 - As we first told you on August 28, 2008, the Missouri DOR agreed to withdraw the proposed rule on state tax addback. In the most recent Missouri Register dated November 3, 2008, the Secretary of State published the official order withdrawing the rule on behalf of the Director of Revenue.

This was the culmination of many months of work with the DOR, challenging the ability to issue this rule under the current statute. This is the third time the DOR has proposed the rule and the third time we have successfully challenged this rule that would have resulted in a tax increase for many employers that operate in multiple states.

Click here and look in the lower right hand corner for the official order withdrawing the rule.

If you have any questions, please contact me at the AIM offices.

Ray McCarty
President
Associated Industries of Missouri

Talks of Tax Increases Premature

October 2, 2008 - The Missouri Budget Project has suggested the state budget is not sustainable with the current level of taxation and suggested that taxes must be increased, according to a story broadcast on KOMU-TV, Columbia, MO.

Ray McCarty, president of Associated Industries of Missouri, told KOMU's Brandon Lewis that holding the line on spending in Missouri has helped the state weather recent fiscal storms much better than other states. McCarty noted that Illinois faced budget challenges similar to those in Missouri several years ago. Illinois did not address spending and is still facing budget shortfalls and additional tax increases to fill their budget deficit. Missouri, on the other hand, took measures to reign in spending instead of tax increases and has enjoyed surplus revenues for several years.

McCarty reminded viewers that the Missouri Budget Project made dire predictions regarding the state budget in April and that TRIM had noted that the revenue shortfall was temporary due to automatic extensions of time to file income tax returnsin many counties that were ravaged by floods. When those returns were received, there was no budget crisis. See story on this subject below.

McCarty told Lewis that increasing taxes in a down economy is not the answer and that tax cuts such as the recent AIM/TRIM Manufacturing Inputs Sales Tax Exemption, have resulted in the creation of additional jobs and improved the economy in Missouri. McCarty said the position of Associated Industries of Missouri is that government must live within its means and if revenues decline, state government may need to more closely scrutinize spending. "Some expenditures may be wise uses of the taxpayers' money, but may not absolutely necessary," said McCarty. "Just as businesses tighten their spending as revenues decline, state government must do the same."

Click here for a link to the KOMU website where you may access a copy of the video.

DOR Withdraws State Tax Addback Regulation

August 21, 2008 - We are happy to announce the Missouri Department of Revenue has withdrawn their proposed state tax add back regulation. See articles below for more information on why we opposed this regulation.

Thanks to all our Tax Committee members that worked hard to fight this over-reaching regulation!

Missouri Department of Revenue Publishes State Tax Addback Rule

July 15, 2008 - As expected, the Missouri Department of Revenue today published a rule requiring taxpayers to add back state taxes.

Associated Industries of Missouri (AIM) and the Taxpayers Research Institute of Missouri (TRIM) are opposed to this regulation because it requires taxpayers to add back into income several state taxes that are NOT state income taxes. AIM and TRIM and several of our members have already met with the Department of Revenue to voice our concerns and will be filing an appeal with the Joint Committee on Administrative Rules. We were successful in defeating previous attempts to file this rule and will make every effort to protect taxpayers from this unreasonable and strained interpretation of Missouri statutes.

For the text of the rule, please click here. We will publish our appeal letter to the Joint Committee in the near future. Taxpayers wishing to have their comments included may send them to Ray McCarty, Executive Director of AIM's Taxpayers Research Institute of Missouri at ray@raymccarty.com.

UDITPA Changes Pondered by NCCUSL Committee

The National Conference of Commissioners on Uniform State Laws (NCCUSL) Drafting Committee (the “Committee”), which will consider possible changes to the Uniform Division of Income for Tax Purposes Act (UDITPA), held its organizational meeting in Chicago May 30,2008. UDITPA is the model act that several states have adopted to govern their corporate income tax collection and is included in the Multistate Tax Compact (MTC). The Multistate Tax Commission was the primary proponent of the possible revision. Click here for a report prepared by Jim Eads, Director of Public Affairs for Ryan.

UPDATE: Jim Eads reports the NCCUSL has retreated a bit on this effort. Read his most current report here.

Mr. Eads also filed an additional report that you may find helpful if researching the issue. You may find the second report here.

You may also find a recent report by Robert Cline, Ernst & Young, on combined reporting of interest. The report was released by the Committee on State Taxation (COST).

DOR Extends Filing Deadlines for Flood Victims

July 7, 2008 - The Missouri Department of Revenue announced today that the filing deadline for taxpayers in the counties of Clark, Lewis, Lincoln, Marion, Pike, Ralls and St. Charles will be extended to August 29, 2008, for any taxes due between June 1, 2008 and August 29, 2008.

On July 2, 2008, the federal government has also extended filing deadlines for these same counties which were declared federal disaster areas. Click here for the full press release from the Department of Revenue.

AIM and TRIM Commend Governor and Lawmakers for Real Property Tax Reform Bill

By Christen Jackson

Associated Industries of Missouri (AIM) and its division the Taxpayers Research Institute of Missouri (TRIM) commend Gov. Matt Blunt for signing into law on Tuesday legislation that will finally provide all Missourians with real relief from rapidly rising property taxes.

Senate Bill 711, sponsored by Senate President Pro Tem Michael Gibbons, R-Kirkwood, closes tax increase loopholes, requires earlier notice and more information, and expands tax relief for seniors and the disabled.

“Owning your own home or business property is the backbone of the American dream, and yet for many Missourians ever increasing property taxes turned that dream into a nightmare,” said Gary Marble, president of Associated Industries of Missouri, who served eight years in the Missouri House of Representatives and helped lead the fight for property tax relief. “I commend Sen. Gibbons for succeeding in passing a reform measure that many of us have championed for more than a decade.”

This is the first legislation that significantly reduces real property taxes since the county sales tax was authorized in 1979, requiring counties to rollback their levies in amounts equal to the new sales tax revenue they would receive from the county sales tax.

“Throughout the process of writing and passing this new law, Associated Industries and the NFIB were the only two general business groups supporting this bill,” said Ray McCarty, executive director of the Taxpayers Research Institute of Missouri. “We supported the positive changes contained in the bill that will benefit the employers in Missouri.”

The new law closes a loophole that allows the taxing districts to apply new voter approved levies to future and unknown assessments. The Missouri Attorney General’s office issued an opinion in 2003 stating that taxing jurisdictions can take a tax increase approved by the voters, for example in 2006, and then apply that new tax rate to the higher reassessed value in 2007. “Many of our members have been upset with the drastic increase in their tax bills resulting from the reassessment of the value of their property every two years without a simultaneous roll-back in the tax rate,” said McCarty. “Because all taxing districts have not been required to roll-back their rates, employers and other property owners receive astronomical increases in their property tax bills. One of our members noted an increase of more than 30 percent.”

McCarty said that SB 711 will require taxing districts to roll-back their rates, and brings transparency to the property tax system by requiring taxing districts that want additional tax money to adopt a policy statement. “This reform measure returns accountability to the real property tax assessment system,” McCarty added. “Associated Industries is proud to have supported this legislation from introduction through final passage.”

Governor Blunt Extends Unemployment Tax Filing Deadline in Flood Damaged Areas

June 27, 2008 - In a press release today, Governor Matt Blunt announced he has requested the Missouri Department of Labor and Industrial Relations extend the filing deadline for unemployment tax reports by 30 days, for employers in counties damaged by recent floods. The second quarter reports would normally be due July 31, but that deadline would be extended to August 31 according to the Governor's press release.

The deadline extension is NOT automatic, however. Employers in the affected counties may request the extension in writing or electronically through the Unemployment State Tax Automated Reporting System (USTARS).

Counties affected by the disaster declaration and this extension are:
The counties of Andrew, Atchison, Buchanan, Cape Girardeau, Clark, Holt, Jefferson, Lewis, Lincoln, Marion, Mississippi, New Madrid, Nodaway, Pemiscot, Perry, Pike, Platte, Ralls, St. Charles, St. Louis, Ste. Genevieve and Scott and the City of St. Louis.


Click here for the full press release.

Governor Blunt Signs TRIM/DOR/DNR Efficiency Measure

June 19, 2008 - Governor Matt Blunt today signed HB 1670, legislation sponsored by Rep. Shannon Cooper at the request of the Tax Committee of Associated Industries of Missouri and the Taxpayers Research Institute of Missouri.

The bill will eliminate the unnecessary certification of pollution control equipment as a prerequisite for sales and use tax exemption. AIM/TRIM pushed for the legislation when we found, as a result of ongoing meetings with the Missouri Department of Revenue, the certification served no practical purpose. After further meetings with the Missouri Department of Natural Resources and the Department of Revenue, it was decided that the certification could be eliminated without negative consequence. The elimination of the certification step will save taxpayers money directly when they purchase exempt equipment and machinery to abate air and water pollution. It will also save all taxpayers money through elimination of unnecessary governmental red tape and will result in a modest cost savings to the state.

AIM/TRIM applaud Governor Blunt's signature of this important bill and thank Rep. Shannon Cooper for his sponsorship of yet another taxpayer friendly bill.

DOR Informational Letter Regarding DSL Fees

The Missouri Department of Revenue has released an informational letter regarding the application of sales tax to DSL fees.

In the information letter, the Department states Missouri will have no ability to apply sales or use taxes to DSL services, effective June 30, 2008. For a copy of the informational letter, please click here.

This action was a result of federal legislation. The Internet Tax Freedom Act of 2007 prohibited the application of sales tax after June 30, 2008, by states that taxed the telecommunications service provided with the Internet service.

The Missouri Department of Revenue has claimed Internet access fees were subject to sales and use taxes in Missouri based on an exception to the original Internet Tax Freedom Act that allowed states that already applied sales taxes to Internet access fees to continue that practice. The original Act prohibited states that were not already collecting such taxes from imposing any sales tax on Internet access fees. According to informal surveys conducted as the Internet Tax Freedom Act was originally considered by Congress, Missouri's telecommunications companies were NOT collecting sales tax on DSL fees at the time the original Act was passed; therefore, the ability of Missouri to apply sales tax to DSL services has always been questionable. At least now the federal government has erased all doubt and effective June 30, 2008, the Missouri DOR will no longer ask our telecommunications companies to collect sales and use taxes on DSL services.

The letter states questions should be directed to Roger Freudenberg, Missouri Department of Revenue, Office of General Counsel, P.O. Box 475, Jefferson City, MO 65105-0475, or you may contact by phone at (573) 751-2633.

Taxpayers Research Institute of Missouri (TRIM) Not Surprised By May State Revenue Report

June 5, 2008 - About one month ago, shortly before the end of the legislative session, the Office of Administration released year-to-date state revenue collection figures for April that showed 2.2% growth over the previous fiscal year. This growth was less than the growth originally projected in the consensus revenue estimate developed by the Office of Administration and House and Senate budget staff.

Some legislators and the Missouri Budget Project immediately announced the decline was indicative of a major problem with state revenues. In a report, the Missouri Budget Project predicted a budget shortfall of a half billion dollars by 2010, and cited the revenue numbers as support for their estimate.

When legislators asked about the revenue numbers, the Taxpayers Research Institute of Missouri responded that the collection data did not reflect a true comparison with the previous year because tax collections for more than one fourth of Missouri's counties were included in the previous years' totals, but not included in the current year-to-date figures. TRIM noted more than 30 counties that were ravaged by natural disasters were granted extra time to file their income tax returns for 2007, until May 19, 2008. TRIM Executive Director Ray McCarty pointed out that the counties involved included many counties with substantial income and that to use the data to predict a revenue problem was a mistake. McCarty urged patience until after the May revenue data were published before declaring any type of budget crisis.

This week, the Office of Administration released the year-to-date state revenue collection data for May and, as predicted by TRIM, the revenue numbers now show there was no real cause for concern. The Office says the 3.6% revenue growth indicates state revenues are back on track with previous estimates of growth. "While the national economy continues to show cause for concern, and Missouri will certainly not be immune from the effect of such national economic cycles, the use of incomplete data to predict a problem with state revenues was inaccurate," said McCarty. "We are pleased the state revenue data now show there was no cause for concern in the first place and that the panic surrounding the revenue estimates was premature."

Tax and Economic Development Legislation in the 2008 Legislative Session

Property Tax Reform

For the first time in nearly 30 years, the Missouri General Assembly has passed legislation that will reduce real property tax rates through roll backs of levies, bring transparency to the property tax levy system, and provide more efficient appeals procedures for taxpayers. This is the first legislation to significantly reduce real property taxes since the county sales tax was authorized in 1979, requiring counties to rollback their levies in amounts equal to the new sales tax revenue they would receive from the county sales tax.

Throughout the process, Associated Industries of Missouri and the NFIB were the only two general business groups supporting the bill. We supported the positive changes contained in the bill that will benefit employers in Missouri. We applaud Senate President Pro Tem Mike Gibbons, and congratulate him on passing SB 711.

Many of our members have been upset with the drastic increase in their tax bills resulting from the reassessment of the value of their property every two years without a simultaneous roll-back in tax rate. Because all taxing districts are not required to roll-back their rates, employers and other taxpayers receive astronomical increases in their property tax bills. One of our members noted an increase of more than 30%!

SB 711 will require taxing districts to roll-back their rates. It will also bring transparency to the property tax system by requiring taxing districts that want additional tax money to adopt a policy statement, ordinance or resolution explaining tax increases in non-reassessment years. The bill also requires taxing districts to play fair with taxpayers by requiring tax increases to be adjusted so they reflect the amount of assessed tax that would be equal to the assessed valuation in effect at the time voters adopted the tax increase multiplied by the new tax rate. The current system allows an automatic double dip tax increase because the tax increase is adopted and then applied to the higher assessed valuations resulting from reassessment. The bill also clarifies procedures that must be followed when taxpayers appeal property tax assessments.

The bill returns some accountability to the real property tax assessment system. Associated Industries of Missouri is proud to have supported this legislation from introduction through final passage and look forward to Governor Blunt’s signature on the new law.

Defense Sales to Foreign Governments

Associated Industries of Missouri was proud to support legislation codifying the exemption of sales of items on the federal munitions list from state and local sales taxes. Only items on the federal munitions list are included in the exemption and it applies to the sale of such items to foreign governments.

Efficiency in Government

AIM asked Representative Shannon Cooper to file our bill to eliminate wasteful and unnecessary certification of pollution control equipment for sales tax exemption purposes. Rep. Cooper agreed and, thanks to his strong leadership, the legislation passed the General Assembly by nearly unanimous votes in both the House and Senate.

The bill is the product of ongoing meetings the AIM/TRIM Tax Committee has conducted with the Missouri Department of Revenue. Through these meetings, and subsequent meetings with the Department of Natural Resources, we found the certification of this equipment was completely unnecessary. We took action to eliminate the red tape, saving money for employer taxpayers directly and, because we are eliminating an unnecessary duty for government, the bill will save all taxpayers money. If approved by Governor Blunt, taxpayers will no longer need to seek certification of air and water pollution control equipment before receiving exemption from sales tax.

Again this year, Associated Industries of Missouri supported legislation that would send to voters a proposal to amend the Missouri Constitution to limit the amount that may be spent by state government. While the proposal bears some similarities to the Hancock Amendment, that amendment only addresses the amount of revenue that may be collected from taxpayers. This new amendment would limit the amount that could be spent by state government and move any excess revenues to savings accounts for use in leaner budget years, protecting the state’s ability to provide necessary services. If enough money is put back in these funds to adequately provide for future service needs, the balance would be used to provide tax relief for all taxpayers. This legislation did not survive the legislative process this year, but was passed by the House and was approved by a Senate committee. We will continue to press for improvements in the way the state government handles your tax dollars.

Economic Development Legislation

Associated Industries of Missouri supported the concepts of mega projects legislation, providing tax incentives to large employers that choose to locate in Missouri. This legislation was specifically drafted to attract a large airplane manufacturer from Canada to the Kansas City area. AIM supported the concept of the plan, but allowed the legislators latitude to determine the details of the deal. In the end, the terms of the deal were adjusted to provide that the company will not receive any benefits until five years after the initial deal, the incentive will be based on a percentage of payroll that is actually created, and the incentives must be repaid through sales of aircraft produced at the facility.

AIM also supported the major economic development bills that were also passed in the legislative session, providing a $20 million increase in the Missouri Quality Jobs program tax credit limitation. The Quality Jobs program is used by existing Missouri employers that are expanding and benefits are available for small companies, high tech companies, and high impact projects. Employers must create a minimum number of jobs paying at least county average wage and provide health benefits for employees in the new jobs. The Taxpayers Research Institute of Missouri compiled a report on the results of the program last year and found that at least $3 in tax benefit is reaped from each tax dollar invested in the program, making the program a win-win for employers and state and local governments, as well as the workers in the new jobs. The bill would also revive the job retention tax credit and that credit would expire in 2013.

Also included in the economic development bills were increases in the tax credit limits for Enhanced Enterprise Zones, maintaining an increase in the Development Tax Credit, and several other items that are important to current and future Missouri employers.

Entrepreneurial Development Council

This bill helps protect small businesses that have developed new products or processes from having their ideas stolen by interests that have a greater ability to afford litigation expenses. This cutting edge legislation could make Missouri the first “entrepreneur-friendly state” – a state that helps its corporate citizens, no matter how small, protect their intellectual property such as patents, copyrights and trademarks. The protections provided by the legislation will encourage innovation in Missouri.

The fund created in HB 2058 could be used for legal defense of intellectual property owned by registered entrepreneurs and for low interest loans and grants to support those entrepreneur’s new products.

Associated Industries of Missouri was the only statewide employer group supporting this legislation, joining universities and economic development groups in the effort. We thank Senator Frank Barnitz and Representative David Pearce for working together in passing this legislation that will help protect Missouri-born intellectual property.

Voice Over Internet Protocol (VoIP)

In response to increasing competition in voice communications and ever-changing telecom technology, legislation was passed to update Missouri laws and allow Missouri consumers to receive the full benefit of competition in the Voice Over Internet Protocol (VoIP) field.

Associated Industries of Missouri supported the bill that was prompted primarily by the need to respond to changes caused by new Internet technology and services that affect all voice providers. The legislation removes from state law barriers to competition between providers of voice services.

Wood Energy Tax Credit Sunset

Senator Brad Lager introduced legislation to sunset the Wood Energy Tax Credit in 2010. We brought together members of the industry to meet with Sen. Lager and were successful in convincing him to extend the sunset by three additional years. The Wood Energy Tax Credit provides an economic incentive to recycle wood byproducts and is used by charcoal producers and others. The charcoal producers are usually found in more rural areas of the states and the jobs provided by those operations are extremely important to local communities. AIM also solicited the assistance of Senator Frank Barnitz as he has one of these facilities in his district and he was extremely helpful in achieving this victory. The Wood Energy Tax Credit will now expire June 30, 2013, provided HB 2058 is signed into law.

Research and Development Tax Credits

Associated Industries of Missouri worked to reinstate a research and development tax credit that had previously expired, but that legislation was not successful this year. AIM will support this effort in the future. But even more importantly, AIM will introduce legislation in the next legislative session that will provide a more comprehensive research and development tax credit – one that will recognize and encourage research and development activities of all companies in a manner similar to the federal research and development tax credit. We worked diligently with experts in our membership and legislative sponsors, but were not able to develop language in time to pass the legislation this session.

Defense Pays Off

Everyone knows defense is important to our legislative efforts every session. This year was no exception. For example, one Senator introduced a bill to decouple from the federal accelerated depreciation that was included in the most recently approved economic stimulus package. We worked hard behind the scenes to successfully thwart that effort, meaning Missouri employers will now be able to fully enjoy the benefits of the accelerated depreciation when calculating their federal and state income tax liabilities.

We were also successful in convincing groups to drop their effort to remove the local use tax exemption that was provided in last years’ AIM/TRIM Manufacturing Inputs Exemption. While well meaning, the effort would have resulted in a tax increase to Missouri manufacturers and we were successful in defeating that effort.

Property Tax Bill Taken Up Briefly In House

Monday, May 12, 2008 - The Missouri House, led by Chairman of the House Ways and Means Committee Rep. Mike Sutherland, briefly took up the property tax legislation sponsored by Senate President Pro Tem Mike Gibbons.

Associated Industries of Missouri is pleased to be the only statewide general business group other than the NFIB to support this comprehensive property tax reform bill. We thank both House handler Rep. Mike Sutherland and Senate President Pro Tem Mike Gibbons for their leadership on this legislation.

State Tax Add-Back Rule is BACK!

Since 2005, Associated Industries of Missouri and the Taxpayers Research Institute of Missouri have fought to prevent the Missouri Department of Revenue from enacting a regulation that we believe exceeds current statutory authority and we have been successful in our previous attempts to convince the DOR to withdraw the rule. But just like the villain in a horror movie, the issue is back on the table.

At issue is which state taxes must be “added back” into Missouri income. Missouri requires any state income taxes that have been deducted to be “added back”, but the law does not specify which state taxes are truly “income taxes”. The issue can be confusing, especially when a state tax has some features of an income tax and some features of another type of tax, such as a franchise tax. For example, the DOR believes the California Franchise Tax should be considered an “income tax”, even though they have argued in at least one case before the Administrative Hearing Commission that the California Franchise Tax is NOT an income tax. Regardless, the DOR believes it is better for taxpayers to know where they stand on the issue, while we represent taxpayers that do not want the DOR to attempt to expand the statute by regulation. If the rule is broader than existing law allows, the DOR would in effect be legislating through regulation, a power reserved for the legislature by the Missouri Constitution.

At the invitation of Rep. Bryan Stevenson, Chairman of the Joint Committee on Administrative Rules, AIM and TRIM, along with other business representatives, are forming a group to work with key staff from the Missouri Department of Revenue. The goal of the group will be to see if there is common ground that may allow the DOR to produce a rule that does not go beyond the current statute and case law on the subject. Director of Revenue Omar Davis has indicated he is willing to listen to our concerns and indicated they intend to file the proposed regulation around the end of May. If you would like to work with the group, please contact Ray McCarty, Executive Director of TRIM, at ray@raymccarty.com as soon as possible.

Gibbons' Property Tax Reform Bill on Calendar

April 21, 2008 - Senate President Pro Tem Mike Gibbons' SB 711 has passed the House committee and is awaiting further debate on the House floor. In the House committee hearing, as in the Senate committee hearing, the Taxpayers Research Institute of Missouri and NFIB were the only statewide employer groups that spoke in favor of the bill.

Property tax reform is extremely important to our members and we are pleased to be leading the charge in supporting these changes to the property tax system. For a copy of the most current version of the bill, click HERE.

AIM/TRIM Again Support President Pro Tem Gibbons' Property Tax Reform Bill

April 3, 2008 - The House Ways and Means Committee today heard testimony on SB 711, sponsored by Senate President Pro Tem Mike Gibbons, a bill that will begin to reform Missouri's property tax system.

Associated Industries of Missouri and the NFIB remain the only two general business groups supporting the bill. We support the positive changes the bill makes for our taxpaying employers.

Many of our members have been upset with the tax bills resulting from the reassessment of the value of their property every two years without a simultaneous roll-back in tax rate. Because all taxing districts are not required to roll-back their rates, employers and other taxpayers receive astronomical increases in their property tax bills. One of our members noted an increase of more than 30%!

SB 711 would require taxing districts to roll-back their rates. It would also bring transparency to the property tax system by requiring taxing districts that want additional tax money to adopt a policy statement, ordinance or resolution explaining tax increases in non-reassessment years. The bill also requires taxing districts to play fair with taxpayers by requiring tax increases to be adjusted so they reflect the amount of assessed tax that would be equal to the assessed valuation in effect at the time voters adopted the tax increase multiplied by the new tax rate. The current system allows an automatic double dip tax increase because the tax increase is adopted and then applied to the higher assessed valuations resulting from reassessment.

County collectors, county assessors, the State Tax Commission and a citizens group in St. Louis County also support the bill.

Associated Industries of Missouri and Taxpayers Research Institute of Missouri Representing Your Interests on Key Issues

ATTENTION MISSOURI BUSINESSES: AIM/TRIM are looking out for your best interests at the Missouri Capitol. AIM/TRIM were the only general business associations testifying on behalf of, and working to pass, the following key legislative issues:

• HJR 70 – House Budget Chairman Allen Icet – Limits growth in state government to growth in the CPI and population. Excess revenues would be placed in two funds to help even out the ebb and flow of revenues and to provide for fiscal emergencies as well as natural disasters. When a certain percentage of total General Revenue has been placed in these funds, the excess would be used to reduce ALL income tax rates, both corporation income and individual income. This clearly helps all businesses in the state in at least two ways:
• keeping government spending under control avoids tax increases that are usually designed to increase taxes for the non-voting business community; and,
• reduction of the corporation income tax rate helps corporations and reduction of the individual income tax rate helps partnerships, S corporations, and sole proprietors.
  

• HB 1981 – Rep. Michael Spreng/ Rep. David Pearce – Income tax credit for sales tax paid on motor vehicles assembled and purchased in Missouri. AIM/TRIM was the only general business group to register testimony in favor of this bill at the hearing this week by the House Special Committee on Job Creation and Economic Development.

AIM and TRIM were joined by NFIB as the only general business representatives supporting SB 711 – Senate President Pro Tem Gibbons’ property tax reform bill.
See article, flyer, and video below for more details of this pro-taxpayer legislation. Property tax increases have hit our business members hard and we want to support Senator Gibbons' effort to bring common sense back to the property tax process. AIM and TRIM also stood alone in support of the companion bill in the Missouri House, HB 2079, sponsored by Rep. Rick Stream and House Ways and Means Chairman Rep. Mike Sutherland.

AIM/TRIM Priority Bill Making Progress
HB 1670 – Rep. Shannon Cooper – our bill to eliminate wasteful and unnecessary certification of pollution control equipment for sales tax exemption purposes has passed the House and now awaits further action in the Missouri Senate. This bill is the product of ongoing meetings the AIM/TRIM Tax Committee has conducted with the Missouri Department of Revenue. Through these meetings, and subsequent meetings with the Department of Natural Resources, we found the certification of this equipment was completely unnecessary. We took action to eliminate the red tape, saving money for employer taxpayers directly and, because we are eliminating an unnecessary duty for government, the bill will save all taxpayers money.

Gibbons' Property Tax Reform Bill Clears Senate

February 27, 2008 - Senate President Pro Tem Michael Gibbons' bill to reform property taxes in Missouri, SB 711, today cleared the Missouri Senate and will now move to the Missouri House. Click on the banner above for a flyer denoting the benefits to business from passage of the bill.

The bill provides important rate rollback provisions and provides transparency in the setting of property tax levies, while eliminating some problems with appeal notification. All of the changes are positive for all Missouri property taxpayers, including all Missouri businesses and we are very supportive of this effort.

Click on the banner above for a flyer on the business impact of SB 711 and click on the picture link below to see an interview with the President Pro Tem regarding this bill.

President Pro Tem Gibbons' Property Tax Bill Takes First Step In Senate

February 21, 2008 - Senate President Pro Tem Michael Gibbons' Property Tax Reform bill, SB 711, received first round approval in the Missouri Senate today.

The bill, supported by Associated Industries of Missouri and the Taxpayers Research Institute of Missouri, helps taxpayers by providing transparency in the setting of property tax rates, requires local taxing districts to roll back their rates in keeping with the spirit of the Hancock Amendment, and enacts several needed changes to allow taxpayers to have more information regarding property tax increases sooner. The sooner taxpayers are aware of runaway tax assessments, the sooner they may prepare to appeal and challenge their property tax assessments. The bill also simplifies the appeals process for taxpayers and eliminates some problems that have surfaced recently that have effectively stopped taxpayers from appealing inappropriate tax assessments.

"This bill provides the transparency and restores the vital role of taxpayers in the taxation of their real and personal property," said Ray McCarty, Executive Director of the Taxpayers Research Institute of Missouri. "We applaud Pro Tem Gibbons' efforts on behalf of Missouri business taxpayers, some of whom have seen 60% increases in their property taxes this year." Click on the picture above for a video of an interview with President Pro Tem Gibbons regarding this bill.

The bill will face a final vote in the Missouri Senate before moving to the House for further debate. Don't forget to check our our new video service with more important tax video information at www.aimcapitolcast.com.

Corporation Income Tax Phaseout Approved by House Committee

HB 1551, a bill to phase-out the corporation income tax filed by Rep. Bryan Stevenson (R-128, Webb City), was approved by the House Special Committee on Tax Reform.

SB 380 in 1993 was the largest tax increase in Missouri’s history. The bill limited the deductibility of federal income taxes and increased the corporation income tax by 25% to 6.25%. This tax increase affects all businesses – large businesses through the increased corporation income tax and the reduction of deductibility of federal income taxes, and small businesses through limitation of the FIT deduction for individuals.

This bill would phase out the corporation income tax 20% per year for 5 years, beginning in tax year 2009 and completely eliminating the tax in tax year 2013. We support eliminating the tax and applaud Representative Stevenson's efforts to improve the business climate in Missouri.

In the hearing on this bill, we offered one word of caution: other states that have eliminated taxes have later re-established similar taxes but circumvented case law and federal protections that have evolved for the former taxes. For example, Ohio is phasing out their franchise tax (similar to our income tax) and instituting a “Commercial Activity Tax” (CAT) in its place. The CAT does not have the long case history of the former franchise tax. It also does not contain federal protections against inappropriate taxation of certain activities (such as P.L. 86-272 that prohibits states from imposing income taxes on activities that are solely solicitation of orders).

We cautioned against the replacement of our current tax with a new tax and support either phasing the tax out completely and not replacing it with another tax, or reducing the rate to a point that makes Missouri more competitive with other states and nations.

The bill will now be eligible for debate by the full House.

Lt. Governor Peter Kinder Decides To Focus on Re-Election as Lt. Governor - Out of Governor's Race

Springfield – Lt. Governor Peter Kinder tonight issued the following statement announcing he will not run for Governor, and will ask Missourians to re-elect him so he can continue to be an effective champion for Missouri values, veterans, seniors and a state government that makes every dollar count:

"I have taken on a cause as Lt. Governor to fight for the values I believe in - the values my mom taught me to believe in - faith, family, personal responsibility, service and keeping commitments to those who have sacrificed for this great nation.

"Missourians can be proud of what we have accomplished together in the Lt. Governor's office for the men and women in uniform who have given so much to this great country and who need an advocate who will fight for them, for the seniors who have worked and saved to build up this nation and who deserve our respect and a higher quality of life and for our workers and employers who deserve a state government that understands how to help Missourians create jobs and grow the economy.

"Working together we have delivered positive change that Missourians deserve and I want to continue keeping the change working for our state. It will take a combined effort of every Republican, ever Democrat, every leader and every Missourian to create jobs, advocate for our veterans, fight illegal immigration and deliver world class schools for our students and I want to continue being an advocate for change on these important issues.

"Since I was elected Lt. Governor in 2004 many Missourians have told me personally they would support me if I ever decided to run for governor. I never expected to make that decision this year.

"Since Gov. Blunt's announcement I have been overwhelmed by the support I have received from many Missourians who want to join my campaign for governor. After a great deal of thought and prayer over the last several weeks I have decided I will not run for governor this year, and will ask Missourians for their vote for Lt. Governor so we can continue our accomplishments for our veterans, seniors, workers and our shared Missouri values.

"This is a campaign I believe I would have won, but I also believe in my heart that this is the right decision. I hope it will help our Party unite so together we can tell Missourians a remarkable story of how together we turned our state around by turning a $1.1 billion deficit into three straight surpluses without raising taxes, ended the cuts to education while increasing funding for classrooms, transformed Missouri's health care system and helped bring nearly 90,000 new jobs to our state by supporting job-creating initiatives and investing in tourism as we did by bringing the Tour of Missouri to our state.

"I am enormously grateful and appreciative of everyone who supported me for governor. I know I can count on their support for my re-election. We must unite and let Missourians know how much is at stake in this election. We cannot afford to return to the failed policies of the past. We must elect a governor who will keep the change working for Missouri and that makes every dollar count."

President Bush Announces Bipartisan Economic Growth Agreement

January 25, 2008 - President George W. Bush yesterday announced agreement with House leaders on an economic stimulus package that will benefit businesses as well as individual taxpayers.

The package includes a full tax break of $600 for individuals with less than $75,000 in income (phased out above that income level), and $1,200 for couples with less than $150,000 in income (also phased out above that income level) in 2008. The package also includes an additional $300 per child for eligible taxpayers.

To stimulate business investment, the package would allow businesses an additional deduction of 50% of the cost of new investment in equipment, software and other tangible property made in 2008. It is not clear from the fact sheet if this is accelerated depreciation or a bonus deduction, but it appears to be the latter.

Senate leaders have indicated they will have their own version of a package ready by the time the House completes their work on the bill, which could receive floor time as early as next week.

You may click on the picture to watch the news conference and here to see a fact sheet on the contents of the package as contained in the White House press package.

CAAP Program May Benefit Your Company When Audited

The Computer Assisted Audit Program (CAAP): A program that can help cut the time a DOR auditor spends in your business during an audit.

During our regular discussions with the Department of Revenue regarding efficiency measures that can help save taxpayers and state tax collectors time and money, it was suggested that we communicate to our readers the benefits of the CAAP. The program allows you to assemble electronic records in a way that allows them to be used by the state's auditors to more efficiently audit your records. The benefit to taxpayers is that the auditors can spend less time disrupting your normal workflow and the accuracy of the audit calculations should be enhanced because you eliminate some errors in transposition. The DOR has a website that tells more about the program:

DOR - Computer Assisted Audit Program Link

We encourage taxpayers to educate themselves about this tool and implement the CAAP program where appropriate.

Governor Blunt's State of the State Address

January 15, 2008 - Did you miss the State of the State? Click HERE for a link to YouTube to watch the entire address.

Does the State Owe Your Company???

January 7, 2008 - TRIM has been conducting informal meetings with the Missouri Department of Revenue in an effort to increase efficiency and eliminate unnecessary work on the part of taxpayers and tax collectors.

We became aware that there were a large number of sales and use tax cash bonds that rightfully belong to taxpayers, but had not been returned to taxpayers because they had not asked for a refund. Our idea was to have the DOR automatically refund those bonds, but in many cases, the taxpayers are out-of-business or have moved, so that suggestion was rejected. Also, the statute that governs the bonds seems to indicate the bonds are to be "released" but there is nothing requiring DOR to spend time looking for taxpayers that have bond money due them.

So, DOR has asked for our help in spreading the word to businesses (and former businesses). If you meet the following criteria, you may be entitled to a refund of your cash bond:

• Your business posted a cash bond when you opened a sales and/or use tax account;

AND

• Your business has completed at least two years of compliance with the tax laws and has had no delinquencies; OR
• You have closed your business and are no longer operating.

If you meet these criteria, you should complete a Bond Refund Application form (click on the link for a form) and and mail it to:

Missouri Department of Revenue
Taxation Bureau
P.O. Box 358
Jefferson City, MO 65105-0358

Or fax it to: (573) 522-1722.

If you have questions about completing this form, you may call the DOR at (573) 751-5860 or e-mail them at businesstaxregister@dor.mo.gov.

Governor Matt Blunt Names Omar Davis Director of Revenue

JEFFERSON CITY - December 27, 2007 - Gov. Matt Blunt today announced Omar Davis will head the Department of Revenue and Todd Smith will serve as the director of the Department of Labor and Industrial Relations.

"Both Omar Davis and Todd Smith have helped me reduce the size of state government by answering my call to implement new efficiencies and reduce fraud and waste all while improving customer service for Missourians," Gov. Blunt said. "I am confident they will continue to make significant and valuable contributions to benefit our state and provide Missourians with accountable and transparent government services that provide the best value for every dollar we invest."

Mr. Davis, 32 of Columbia, will leave his post as the director of the Department of Labor and Industrial Relations to head up the Department of Revenue. He previously served as the director of Legal Services Division and general counsel for the Department of Revenue. Davis also worked as Deputy General Counsel in the Office of Gov. Matt Blunt and Securities Enforcement Council for Blunt when he was Secretary of State. Mr. Davis holds a bachelor's degree in psychology from Kansas State University and a juris doctorate from the University of Missouri School of Law.

The governor also announced he approves the Labor and Industrial Relations Commission's nomination of Todd Smith to replace Mr. Davis as the director of the Department of Labor and Industrial Relations.

Mr. Smith, 48 of Sedalia, is currently the Deputy Director for the Department of Labor and Industrial Relations. He previously worked as Director of Legislative Affairs in the Office of Gov. Matt Blunt and is a former state representative. Mr. Smith served in the Missouri General Assembly from 1984-1994 and from 2002-2006. Smith also served as the Presiding Commissioner of Pettis County in between his service in the state legislature. He also worked in manufacturing and was co-owner of an advertising and public relations company.

President Bush Extends Internet Tax Moratorium

October 31 - President George W. Bush has signed an extension of the Internet Tax moratorium that protects consumers from state and local taxes levied on internet access until November 1, 2014. Without this action, the previous moratorium would have expired November 1, 2007.

Missouri tax officials claim they are "grandfathered" in and may continue to collect tax on internet access because they collect them today and have collected such taxes prior to October of 1998. However, most (if not all) telecommunications companies are not now charging, nor have they charged, state or local sales taxes on fees charged to customers for internet access. Photo credit: allen.senate.gov

Click here for the entire article from Deloitte.

October 24, 2007 - DOR Extends Credit Process for Utility Vendors

October 24, 2007 - The Taxpayers Research Institute of Missouri, a division of Associated Industries of Missouri, contacted the Missouri Department of Revenue today regarding the simplified credit process for sales of energy sources and water on behalf of Missouri utility vendors. The simplified process was to have expired October 28, 2007.

Following our contact with the Department, late this afternoon the DOR issued an extension of this credit process until January 31, 2008. They also stated this deadline will NOT be extended. An extension of this simplified process was important in helping utility companies and the DOR avoid thousands of refund requests and amended sales tax returns that would have been required to properly account for sales of utilities that are entitled to exemption from state and local use tax and state sales tax under the AIM/TRIM Manufacturing Inputs Exemption in SB 30. The simplified process furthers the Department of Revenue's stated goal of allowing as many manufacturers as possible to take full advantage of the new exemption without delay while minimizing paperwork as much as possible for the sellers for the sellers of the exempt items.

Utility vendors are in a unique situation in that all manufacturers obtain energy from a relatively small number of utility providers in the state, making the concentration of exempt transactions much higher than for other vendors. In other words, all utility companies will be affected by the exemption and every manufacturer obtains power from one of the utility companies. The process of receiving and tracking exemption certificates and making the necessary bookkeeping adjustments to charge only the local tax is an overwhelming task, especially since many manufacturers are just now discovering they are entitled to the AIM/TRIM exemption. As they provide exemption certificates to their utility vendors, all bills after August 28, 2007 will be affected by the new exemption and only local sales tax will be charged on the appropriate manufacturing percentage as determined by the manufacturer. If a manufacturer uses at least 76% of the energy purchased for one of the exempt processes in SB 30 (manufacturing, mining, producing, compounding, processing a product), all of their utility purchases for that facility will be subject to local sales tax only under the AIM/TRIM Manufacturing Inputs Exemption.


AIM/TRIM applauds the Missouri Department of Revenue and its leadership, particularly Director of Revenue Trish Vincent and Deputy Director of Revenue Lowell Pearson for implementing the AIM/TRIM Manufacturing Inputs Exemption in a fair and reasonable manner that upholds the spirit of the exemption: to make Missouri manufacturers more competitive with manufacturers in other states.

You may find the new extension at the top of the list of SB 30 documents at the top of this page.

DOR Codifies Guidance in Proposed and Emergency Rules

October 10, 2007 - The DOR has filed a proposed and accompanying emergency rule that codifies their previous "DOR Guidance" document with some changes. You may find the new rules by following the links at the top of this page.

DOR: Treatment of Lease Payments

October 9, 2007 - We have learned the DOR has decided lease payments on qualifying equipment will be exempted or taxed based on the date of such lease payments.

As a result, even though a lease was initiated prior to August 28, 2007, lease payments made on or after that date for equipment covered under the new AIM/TRIM Manufacturing Inputs Tax Exemption will be exempted from state and local use taxes and state sales taxes. Local sales taxes will continue to apply to such lease payments.

This makes sense because Missouri's sales tax law is a gross receipts tax. Gross receipts on leases occur when the lease payment is made, so the law in effect when the lease payment is made should govern the transaction, even though the lease was initiated prior to the effective date of the new AIM/TRIM Manufacturing Inputs Tax Exemption.

Proposed and Emergency Rules Filed

September 26, 2007 - The Missouri Department of Revenue filed a set of emergency rules and regular proposed rules with the Secretary of State and those rules have been published in the September 17, 2007, edition of the Missouri Register.

The rules include the manufacturing rules that have been modified or established to reflect the Department's interpretation of the recently implemented AIM/TRIM Manufacturing Inputs exemption contained in SB 30. While the emergency rules are in effect and will expire February 23, 2008, taxpayers may file comments on the regular proposed rules prior to October 17, 2007. Comments in support of or in opposition to the proposed rules should be sent to:

Missouri Department of Revenue
Legal Services Division
Governmental Affairs Bureau
P.O. Box 475
Jefferson City, MO 65105-0475

Visit the following links to view the emergency and proposed rules (the links are also included at the top of this page):
Emergency Rules Published September 17, 2007
Proposed Rules Published September 17, 2007

If you like, you may also send copies of any comments you make to us via email at ray@raymccarty.com or via regular mail at:

Ray McCarty
Executive Director
Taxpayers Research Institute of Missouri
3234 W. Truman Blvd.
Jefferson City, MO 65109

DOR Decides Repair Parts Included in AIM/TRIM Exemption

September 11, 2007 - The Department of Revenue has decided parts purchased for use on machinery and equipment that is entitled to the AIM/TRIM Manufacturing Inputs sales tax exemption would also be exempt. As such, the purchase of such parts will be exempt from state sales tax and state and local use taxes.

Many taxpayers may recall previous administrations of the Department of Revenue that forced taxpayers to seek and eventually obtain a legislative change to include parts in the original manufacturing machinery and equipment exemptions. The decision by this administration to treat parts the same as the machinery and equipment to which it is attached is refreshing.

See articles below for additional details regarding the exemption that have been provided by the Department of Revenue.

DOR Answers Questions

Here are the Department of Revenue's responses to the questions asked by manufacturers at a recent meeting in Neosho, MO, regarding the AIM/TRIM Manufacturing Inputs state sales and use tax (and local use tax) exemption in section 144.054 of SB 30:

• Water used in cleaning products during in the manufacturing process (such as prior to painting, for example) is exempt from state and local use taxes and state sales taxes under the AIM/TRIM Manufacturing Inputs Exemption in section 144.054 of SB 30;
• Water used to cool equipment that is used in manufacturing is a material that is exempt from state and local use taxes and state sales taxes under the AIM/TRIM exemption;
• Coolant used in manufacturing machinery and equipment is exempt from state and local use taxes and state sales taxes;
• Water used in the form of steam or used in chillers in a manufacturing facility is exempt from state and local use taxes and state sales taxes ;
• Warehousing utilities are exempt from state and local use taxes and state sales taxes (even if held to be taxable, warehousing utilities that are part of the manufacturing facility should be covered under the tier system established by DOR, so if 76% or more of the total energy purchased is for manufacturing, the entire energy purchase would be exempt from state and local use taxes and state sales taxes);
• Quality control processes in the manufacturing facility are exempt processes under the AIM/TRIM exemption for state and local use taxes and state sales tax;
• Laboratory materials and supplies used for quality control or other manufacturing processes are exempt from state and local use taxes and state sales taxes;
• Gloves, ear plugs, goggles and other safety equipment are exempt from state and local use taxes and state sales taxes;
• Processes used to preserve products at the production facility are part of the production process and machinery, equipment, materials and energy purchased for use in those processes are exempt from state and local use taxes and state sales taxes;
• Wastewater treatment, both pre- and post-production, would be included as part of the manufacturing process, so chemicals, water, materials, machinery, equipment, etc., would qualify for exemption from state and local use taxes and state sales taxes under the AIM/TRIM exemption;
• Epoxy or other floor coatings would NOT be included as a material used in manufacturing, producing, etc., a product and are NOT entitled to exemption;
• Racks used in the production process are exempt from state and local use taxes and state sales taxes, even if those racks are used to ship the products to customers. The fact they are used in the production process allows them to be included under section 144.054;
• Safety posters would NOT be considered safety equipment and the purchase of such posters would NOT be exempt under section 144.054;
• Warehousing of raw materials is considered to be part of the manufacturing process and energy, machinery and equipment purchased for use or consumption in such warehousing of raw materials would be exempt from state and local use taxes and state sales taxes under section 144.054;
• The purchase of equipment used in a maintenance department of a manufacturing or production facility to maintain other production equipment is entitled to exemption from state and local use taxes and state sales taxes.

As we receive additional information, we will post it here, so please check back often for updates.