Missouri finances to take hit from higher federal tax

Missouri finances to take hit from higher federal tax

Missouri finances to take hit from higher federal tax

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by Associated Press

KMOV.com

Posted on January 9, 2013 at 11:39 AM

JEFFERSON CITY, Mo. -- Missouri’s finances could take a $60 million annual hit because of a recent 2 percentage point increase in federal Social Security payroll taxes.

State budget director Linda Luebbering (LOO’-ber-ing) says the lost revenues resulting from the federal Social Security tax already had been taken into consideration for budget projections. She says the reduced revenue should not come as a surprise to state officials.

The Social Security tax reverted to 6.2 percent this month after the expiration of a 2 percentage point cut that had been in place for a couple of years.

A rise in federal taxes results in a decrease in state taxes, because people can claim their federal taxes as a deduction on their state income tax forms.

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