MO HB1238

Replaces Missouri's existing 10-bracket income tax structure (1.5% to 6% on income over $9,000) with a new 12-bracket system for tax years beginning January 1, 2017, with rates ranging from 1.5% on income under $2,000 to 9% on income over $50,000

Eliminates the existing mechanism for automatic top rate reductions tied to state revenue growth and removes the federal income tax deduction for individual taxpayers (previously capped at $5,000 single/$10,000 joint)

Creates a new refundable tax credit of up to $200 per eligible person for lower-income taxpayers, with full credit available for single filers under $30,000 and joint/head of household filers under $60,000, phasing out completely at $50,000 and $80,000 respectively

Requires annual inflation adjustments to all income brackets and tax credit thresholds based on the Consumer Price Index for All Urban Consumers (CPI-U)

Contains a referendum clause requiring voter approval at the November 2015 general election or a special election called by the governor before taking effect