Governor Jay Nixon has resorted to the use of puns in his veto letter for Senate Bill 20, a bill that would have treated commercial laundries like manufacturers for the purposes of sales/use taxes.
“Double taxation is no laughing matter,” said Ray McCarty, president and CEO of Associated Industries of Missouri. “This bill would have ensured these businesses were not taxed on inputs and they would continue to collect tax on the services they provide. But the governor has chosen to veto this measure, meaning it will be up to the Legislature to override his veto.”
In a decision that was riddled with puns, the Missouri Supreme Court ruled against a large commercial laundry operation that had challenged an assessment of sales tax on their inputs. Using phrases such as “plumbed the sudsy depths” and “wash, rinse, repeat”, the decision read more like a children’s story than a Missouri Supreme Court opinion. Now, Governor Nixon has continued this trend by using some of the same phrases in his veto letter of a bill that was passed to correct this problematic ruling. He even added a few new puns (i.e. “…Missouri taxpayers would be getting taken to the cleaners” “…tailor-made exemptions…” etc.).
While double taxation may be a laughing matter for Supreme Court justices and Governor Nixon, it is no laughing matter for the commercial laundries or their customers that will be paying higher tax bills. Because of the aggressive position of the Missouri Department of Revenue, these businesses now must pay tax on their inputs and collect tax on their outputs, resulting in double taxation of the industry. Of course, tax on their inputs will be reflected in the prices they must charge their customers, including hospitals, nursing homes, etc.
The governor vetoed similar legislation last year. Veto session will provide an opportunity for the legislature to override the governor’s veto and end the double taxation of these commercial laundries.