Earlier this year, the HBA of Greater Springfield board of directors endorsed this ballot initiative to permanently protect homes from double taxation. See the video below and answers to common questions about Amendment 3 and you can visit the Vote “Yes” to Save Homes website by clicking here.
What would Amendment 3 do?
What is a real estate transfer tax?
It’s a tax imposed by state or local governments, or both, that is collected when you transfer ownership of your home, land or other real estate. Typically, once the tax is on the books, the rate can be increased by the state, city or county without a vote of the people.
What is the specific language of Amendment 3?
Amendment 3 is simple and straightforward: “Shall the Missouri Constitution be amended to prevent the state, counties, and other political subdivisions from imposing any new tax, including a sales tax, on the sale or transfer of homes or any other real estate?”
Do Missouri or its local governments now impose real estate transfer taxes?
These unfair taxes are currently allowed under the Missouri Constitution. Even though these unfair taxes are not now being collected in Missouri, 37 states and the District of Columbia are imposing some variation of a real estate transfer tax. Missouri needs to head off this temptation to politicians that amounts to unfair double taxation.
How many states impose real estate transfer taxes or their equivalents?
Currently, 37 states and the District of Columbia impose transfer taxes or their equivalents, while Missouri is among 13 states that do not impose such taxes. All of Missouri’s neighboring states impose some tax on real estate transactions.
If Missouri and its local governments don’t now impose real estate transfer taxes, why should we change our Constitution to bar these taxes?
As state, county and city revenues decline, politicians are tempted to raise taxes – just as Missouri citizens are struggling to make it. All of Missouri’s neighboring states have imposed some sort of real estate transfer tax. Politicians frequently borrow bad ideas. Once these double taxes are on the books, politicians can increase the tax rates. Nationally, states have raised the tax rate 80 percent on average each time they have imposed transfer taxes. It can happen in Missouri under current law. Amendment 3 will keep politicians from miring us in the bad public policy of unfair double taxation.
What is your objection to a real estate transfer tax?
Missouri homeowners already pay property tax. So a real estate transfer tax is double taxation. Many families have owned their homes for decades, and they have already paid thousands of dollars in property taxes and other fees. Adding double taxation through a real estate transfer tax is simply bad public policy. It denies fairness, and it defies Missouri common sense.
How would a real estate transfer tax affect families that own property?
Real estate transfer taxes are family-unfriendly. Small farms and family homes that have been passed down for generations would be subject to the unfair burden of double taxation, if transfer taxes are imposed on land for which property taxes have already been paid for decades. And such a transfer tax would be imposed before the federal government takes its 50 percent “death tax” bite on family properties. Common sense tells us we should prohibit such family unfriendly taxation that destroys dreams and homeowner equity, by passing Amendment 3.
What would be the consumer economic impact of imposing real estate transfer taxes at the state or local level in Missouri?
In this tough economy, many Missourians have lost jobs or experienced pay cuts. Some have been forced to sell their homes at a loss because of drops in property values. This is particularly true for lower-income Missourians, who typically spend a larger percentage of their income on their homes. Our Missouri neighbors experiencing such financial strain shouldn’t be subjected to more taxes, especially the double taxation of a real estate transfer tax.
What would be Amendment 3’s fiscal impact on government?
Since these unfair taxes are not now being collected in Missouri, and Amendment 3 would keep it that way, there would not be a new fiscal impact. Thus, Amendment 3 is revenue-neutral.
What is the legal status of Amendment 3?
A Cole County Circuit Judge ruled Amendment 3 had more than enough valid signatures of registered voters to qualify for the November ballot. Our campaign worked with the judge and the Secretary of State to resolve any concerns about the court ruling, in a win for voter rights.
How would Amendment 3 work alongside proposals for a “Fair Tax?”
The “Fair Tax” proposal that has been debated but not enacted by Missouri lawmakers would replace the state income tax with a sales tax on certain items. Any discussion about a proposed new sales tax should include assuring adequate revenue is generated to replace income taxes, by creating jobs and drawing companies and workers to Missouri. Those companies and workers will want to buy business properties and homes. To grow the economy, we must assure there isn’t unfair double taxation on real estate for businesses and individuals. Regardless of where you stand on the “Fair Tax,” we can all agree that the same piece of property should not be taxed twice.
How would Amendment 3 work with the Missouri Constitution’s existing Hancock Amendment, and does Hancock already provide legal protection against a transfer tax?
The state legislature can comply with the Hancock Amendment and still raise taxes on its own – without a vote of the people – up to about $90 million a year. And such a tax increase could be imposed by the legislature through a real estate transfer tax. So the Hancock Amendment doesn’t offer protection against a transfer tax. And, there is no settled case law on the question of whether the Hancock Amendment would limit the ability of local governments to boost a transfer tax rate without seeking a vote of the people. That’s because there is debate, even among legal experts, about how the Hancock Amendment applies to municipalities. And that’s another reason we cannot depend on the Hancock Amendment to protect us from a transfer tax. Finally, Amendment 3 to bar a transfer tax doesn’t clash with the Hancock Amendment’s tax limitation provisions. It actually compliments Hancock, because Amendment 3 is revenue-neutral. That’s because the transfer tax isn’t currently being collected and the tax would be barred under the proposed amendment.
Why make this effort in Missouri?
Where better than the heart of our country to make a stand to defend the heart of the American dream of home ownership? We are making this stand because Missouri is a national bellwether, and our people are known for their common sense.
Have you done any polling?
Yes. Our polling found more than seven-in-ten Missouri registered voters support Amendment 3 to stop double taxation, reflecting Missouri common sense about bad public policy. Missourians by similar strong majorities said they would have serious doubts about their elected officials who didn’t share their support of this amendment.
Who is backing Amendment 3?
Amendment 3’s initial strong supporters are the 21,000 members of the Missouri Association of REALTORS ®, which is our state’s largest trade association, comprised of hometown neighbors from every Missouri community. Many HBA affiliates in Missouri including the HBA of Greater Springfield have also endorsed Amendment 3.