Auditor’s report highlights how law allows big retailers to pocket sales tax money – Newstalk KZRG

JEFFERSON CITY, Mo. – A report released by State Auditor Nicole Galloway again highlights a sales tax cut that primarily benefits the state’s largest retailers by rewarding them for paying their sales taxes. and use on time.

In fiscal year 2021, Missouri retailers used this rebate — the most generous in the nation — to keep more than $141 million that could otherwise have been spent on services for Missourians at the state and local level. .

Auditor Galloway has highlighted the corporate giveaway in her Missouri Department of Revenue (DOR) sales and use tax audits for several years. She urges lawmakers to assess the need for a timely sales tax cut or consider putting a cap on the amount.

“Missouri’s rebate gives the greatest benefits to the wealthiest retailers just to remit sales tax paid by consumers,” Auditor Galloway said. “Ordinary citizens don’t get a discount for paying their taxes on time. The lack of a cap on this big business aid means millions of lost dollars that could be used to fix streets, pay law enforcement and improve the lives of Missourians. It’s just common sense.”

The audit found that the 2% rebate given to retailers for timely payment of sales and use taxes they owe is the most generous rebate in the country. In fiscal year 2021, companies using the rebate retained approximately $141 million in sales and use taxes paid by consumers.

Unlike most of the other 26 states that offer a prompt payment discount, Missouri does not have a cap on the discount it gives. The audit said that if Missouri had implemented a cap of $1,000 per month (the highest cap used by any contiguous state) for fiscal year 2021, it would only have impacted businesses whose monthly taxable sales were about $606,000 or more, and had translated to about $82.6 million. in additional state and local sales tax revenue.

The audit also found that the DOR is not required to report, and does not routinely report, the amount of timely remittances withheld by companies to the General Assembly, relevant local governments, or the general public. The audit recommends that state legislators consider amending current state laws to require the DOR to annually report reduction in state revenue related to timely remittance to the General Assembly, applicable political subdivisions and to the general public.

The full DOR sales and use tax audit can be found here.

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