Beware of the tax-cut promise
that cuts funds to public schools

No one likes to pay taxes. That especially applies to retirees on fixed and/or limited incomes. Several bills currently before the Missouri General Assembly would exempt Social Security pensions and/or other public pensions from state income tax. To retirees these bills can sound very attractive. That is exactly what proponents of these bills are hoping. They know that retirees can be very effective lobbyists.

But beware of legislators bearing “gifts.” A tax cut by any other name can also be a revenue reducer. The financial impact of these proposals could reduce state revenue—and thus financial support for our schools—by as much as $500 million annually. That amount would continue to grow as “baby boomers” retire.

Our Missouri legislators have several options, however, that could help retirees without penalizing education or other state programs. Making our state income tax more progressive is one possibility and a method that could shift the tax burden more fairly to those who can afford it the most. Another possibility is reducing the reliance on sales tax and property taxes, both of which are regressive and impact low income people the most.

At the federal level, Congress can help public pension employees by passing the Social Security Fairness Act (H.R. 82/SB 206), which calls for full repeal of the Government Pension Offset and the Windfall Elimination Provision. These provisions also affect limited income retirees the most. The recent shift in Congress has improved the outlook for this bill, which would enable public employees to receive their fair share of monies they have contributed to Social Security. Senator McCaskill and Representatives Blunt, Carnahan, Clay, Cleaver, Emerson and Graves have already signed on as co-sponsors. Those who cry “wolf,” and advocate for mandatory coverage or privatization of Social Security, overlook a very simple way to address the solvency issue: simply raise the cap on Social Security contributions, currently at $96,000 annually.

As NEA members, we have an obligation and an opportunity to stay informed and to work to achieve financial support for public education that is both adequate and equitable. We also want fair compensation and benefits for education employees and retirees. As retirees, we have an obligation to oppose transparent “tax cuts” that will hurt our schools. After all, we care about our schools—and we have grandchildren.

NOTE: MNEA-Retired members will be going to Jefferson City May 8 and 9 to lobby during that critical last week of the legislative session while MNEA active members are still in school.

by Martha Karlovetz
MNEA-Retired president