Why a Sales Tax Is Better for Missouri than an Income Tax

Economy | December 18, 2009

By Rex Sinquefield | Read Time 1 minute

By most measures, Missouri is not a high-tax state. Its property and corporate tax rates are among the lowest in the country. It doesn’t have an inheritance tax. In a study for the American Legislative Exchange Council (ALEC), economist Arthur Laffer, financial journalist Stephen Moore, and Jonathan Williams, director of ALEC’s Tax and Fiscal Policy Task Force, rank Missouri’s economic outlook at 23rd among states.

But all isn’t well. Missouri’s economic development and growth rates are chronically below average. During the past 10 years, employment has grown 8.8 percent nationally, while Missouri has boosted jobs by only 6 percent. In their study, Laffer, Moore, and Williams provide one explanation for the state’s lagging performance: Missouri’s personal income tax rates.

About the Author

Rex Sinquefield

Rex Sinquefield is co-founder and former co-chairman of Dimensional Fund Advisors, Inc. He also is co-founder of the Show-Me Institute. In the 1970s, he co-authored (with Roger Ibbotson) a series of papers and books titled Stocks, Bonds, Bills & Inflation. These works provided the first seminal data on the performance of the financial market in the United States. At American National Bank of Chicago, he pioneered many of the nation's first index funds. He is a life trustee of St. Louis University and DePaul University and a trustee of the St. Vincent Home for Children in Saint Louis. He serves on the boards of the Saint Louis Symphony Orchestra, the Saint Louis Art Museum, the Missouri Botanical Garden, Opera Theatre of Saint Louis, and Saint Louis University. He received a B.S. from Saint Louis University and his M.B.A. from the University of Chicago in 1972.

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