Parson administration knew Missouri taxpayers would take hit from Trump/GOP tax law, but kept quiet until after elections

By TIM ROWDEN
Editor

Jefferson City – Missouri taxpayers are starting to get the bad news.

As a result of the elimination of the SALT (State And Local Tax) deduction under the Trump/GOP tax law, many who had been able to deduct those tax payments from their federal taxes are now finding that, instead of breaking even or getting a refund, they actually owe additional taxes on those same dollars.

Missouri’s Republican leadership knew the changes to the federal tax law would impact Missouri taxpayers but kept quiet about it.

On March 14, after months of criticism by state lawmakers over how his agency handled the tax code changes expected to reduce or eliminate refunds for thousands of Missouri taxpayers, Department of Revenue Director Joel Walters resigned.

His departure follows a report from the Columbia Daily Tribune that records it obtained under Missouri’s Sunshine Law show the department drafted a press release late last year aimed at notifying taxpayers that they should increase their withholdings from paychecks to avoid a surprise tax bill in 2019. The release was never made public.

State lawmakers have been highly critical for months of the department’s failure to warn Missourians that they could be hit with an unexpected tax bill.

But Republican Gov. Mike Parson stuck by Walters, releasing a statement last month accusing lawmakers who were investigating the tax issue of “political grandstanding.”

‘LYING THIS WHOLE TIME’
Walters, who was appointed to his post by former Gov. Eric Greitens, previously testified that a 15-year-old error in state tax tables was discovered following implementation of federal tax cuts last year. That error, he explained, meant many workers didn’t withhold enough money from their paychecks throughout 2018.

However, last month, during a hearing with a Missouri House oversight committee, Walters admitted that, in fact, there was no error, drawing condemnation from both sides of the aisle.

“He’s been lying this whole time,” Rep. Robert Ross, the Texas County Republican who chairs the House oversight committee told the Kansas City Star. “That’s the frustrating part. It’s hard to do our job and wrap our minds around all the issues when we don’t have confidence or trust in the department or the director.”

‘ADMINISTRATION COVERED IT UP’
House Minority Leader Crystal Quade (D-Springfield) said there is plenty of blame to go around.

“It has been clear for weeks that the Missouri Department of Revenue needs new leadership. But the director’s departure in no way absolves Governor Mike Parson and top members of his administration for their roles in this debacle,” Quade said.

“The Parson administration was aware in the fall that the Trump tax law would result in surprise tax bills for countless Missourians. Instead of taking steps to warn Missourians of this problem, the administration covered it up to prevent it from being an issue ahead of the November elections.

“The resignation of Director Walters is just a first step that must include Governor Parson taking full responsibility for his administration’s failures and committing to providing relief to those Missourians who are in a financial bind as a result.”

TRANSFORMATIVE VISION?
Parson, who on Friday announced the appointment of Ken Zellers as acting director of revenue, while praising Walters for his service, gave no indication that Missouri taxpayers should expect anything more.

“I appreciate Joel Walters’ willingness to devote two years of service to the State of Missouri,” Parson said. “His leadership and transformative vision helped to turn around the Department of Revenue, leading to increased customer service, identifying efficiencies that led to significant budget savings, and implementing a number of conservative reforms that helped improve and streamline services for Missouri taxpayers.”

Zellers had been serving as chief operating officer for the Department of Revenue.

“I have full confidence that the Department of Revenue will continue providing excellent service to the people of Missouri,” Parson said. “Our administration will build off the positive reforms made within the department and ensure Missourians continue to benefit from historical tax cuts made at the federal and state level.”