Koster sides with Nixon in legal opinion on tax cut

Koster issued an opinion today, stating that a provision in the legislation that triggers a reduction in the state income tax rate if Congress approves the Marketplace Fairness Act would have applied retroactively.

"In the opinion of this office, the plain language of the new legislation suggests that, if certain triggering events set forth in the statute occur, taxpayers may seek refunds of taxes paid in the three preceding tax years," Koster wrote in an opinion that backs Nixon’s analysis but conflicts with the General Assembly’s Legislative Research Office.

The Republican-controlled state Legislature passed the income tax cut — which would have been Missouri’s first in nearly a century — but Nixon, a Democrat, vetoed the measure shortly after the legislative session ended. Republican leaders want to override Nixon during a September veto session.

While the two sides have waged campaigns in favor of and against the tax cut legislation, Koster, a Democrat and likely candidate for governor in 2016, has been relatively quiet – offering no official stance on the effort to override Nixon because he said he wanted his legal opinion to remain unbiased.

The retroactivity component, which Nixon says could lead to an immediate $1.2 billion hit to the state budget in a single year, is just one of the arguments the governor has been making against the legislation on dozens of trips across the state in recent weeks.

Today’s opinion came at the request of House Speaker Tim Jones, R-Eureka, who had said Nixon’s retroactivity claims were “sensationalized talking points and not in any way based on statutory reality or legal precedent.” Jones has been eyeing a 2016 run for attorney general.

Jones responded to Koster's opinion this afternoon, accusing the attorney general of siding "with the liberal, tax-and-spend views of the governor and the president."

"In doing so, he missed an opportunity to join Republicans in our defense of Missouri taxpayers," Jones said. "Going forward, we will continue to rely on the legal analysis of our independent, non-partisan Legislative Research department that clearly refutes the highly-partisan claims made by the governor and now the attorney general."

Supporters of the tax cut legislation are hosting Texas Gov. Rick Perry in St. Louis today, as he touts that state's tax policies and encourages Missouri businesses to move there.