Why I Support the Earnings Tax and Voted Against Proposition A

As you probably know, Proposition A would require St. Louis and Kansas City to hold an election every five years to keep their earnings taxes. And it prohibits any other Missouri municipality from  establishing the tax, regardless of the desires of the elected officials or residents.

The St. Louis earnings tax is unique among the state and local taxes I have paid in the last 33 years — the rate has never changed. The rates of income taxes, sales taxes, property taxes and gross receipts taxes (on our utility bills) have all gone up. But the earnings tax has remained at 1 percent.

When I started at the St. Louis Post-Dispatch as a mail and phone clerk in 1977, I made $10,000 a year and paid $100 to the city for police and fire protection of my workplace. When I took early retirement as a reporter in 2004, I made about $60,000 and paid the city $600 in earnings tax.

It is the fairest tax I have ever paid. The more you make, the more you pay. If you have a bad year — hours cut, laid off, on strike — you pay less tax. If you have a good year — bonuses, pay raise, overtime pay — you pay more tax.

That contrasts with the gross receipts tax — which many suburban municipalities rely on for much of their revenue — that taxes you more the higher your bill. So when you struggle with high utility bills, your tax goes up too. The earnings tax contrasts with sales taxes as well. Unlike state sales tax, which we don’t pay on sales of food and medicine, local sales taxes are usually levied on everything you buy.

Those who pay a higher percentage of their income for necessities like food or electricity also pay a higher percentage of their income in taxes on those necessities.

Unlike Social Security tax, there is no cap on the income subject to the earnings tax. So the publisher of the Post-Dispatch paid 1 percent on his $1 million-plus salary, the same as I did on my $10,000.

And that, my friends and family, is why a billionaire outsider has funded Proposition A. Because he doesn’t want any more municipalities to discover the fairness of a tax based on one’s ability to pay.

Please vote against Proposition A. Not only for the people in St. Louis, for which earnings tax receipts fund a third of the municipal budget. But for the residents of every other municipality in the state that might find an earnings tax to be a fair source of revenue for public services.

Virginia Baldwin Gilbert


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