Gov. Jay Nixon has once again vetoed the General Assembly’s response to a state Supreme Court decision which invalidated local taxes on out of state and person-to-person vehicle sales.

On Friday, Nixon vetoed Senate Bill 182.

He says the bill, as passed by the General Assembly, fails to protect Missourians’ right to vote on all the taxes the bill would impose.

 

The 2012 Missouri Supreme Court decision created an incentive for consumers to purchase vehicles from out-of-state, rather than in-state, dealers. Last year, Gov. Nixon vetoed the General Assembly’s first attempt to address this circumstance, House Bill 1329, because it would have imposed a new tax retroactively and without a vote of the people.

Unlike House Bill 1329, Senate Bill 182 would not apply the tax retroactively and would provide voters the opportunity to repeal it. Gov. Nixon said that while this represents a significant improvement over last year’s version, the bill as drafted contains fundamental flaws that require his disapproval.

For example, under Senate Bill 182, the required voter referendum on the tax would not cover the full extent of the tax imposed. That means that voters would continue to be taxed for private vehicle sales, representing 85 percent of applicable transactions, even if the vote to repeal had passed. “Denying the voters the ability to be heard on the entire scope of this tax is unacceptable and requires my disapproval,” Gov. Nixon said in his veto message.

Gov. Nixon also noted that, in the event of a petition to repeal the tax, “local voters could not repeal the local sales tax on out-of-state and non-retail vehicle transactions… without repealing the local sales tax on all vehicle transactions, including vehicles purchased in-state at retail.” Such an outcome would hamper the ability of local jurisdictions to fund and perform necessary services.