Last year, we noted that North Dakota was one of the few states with a structural budget surplus, thanks to flush revenues from the personal and corporate income taxes. In November 2008, a ballot initiative to cut these rates did not pass, partly because of concerns about whether it would interfere with a separate push to cut property taxes. Now, however, Gov. John Hoeven has approved a much more modest cut in the two taxes, retroactive to January 1, 2009: North Dakota Individual Income Tax, 2009 Single Person Income Bracket Pre-Cut Rate Post-Cut Rate >$0 2.10% 1.84% >$33,950 3.92% 3.44% >$82,250 4.34% 3.81% >$171,550 5.04% 4.42% >$372,950 5.54% 4.86% Married Filing Jointly & Surviving Spouse Income Bracket Pre-Cut Rate Post-Cut Rate >$0 2.10% 1.84% >$56,750 3.92% 3.44% >$137,050 4.34% 3.81% >$208,850 5.04% 4.42% >$372,950 5.54% 4.86% North Dakota Corporate Income Tax, 2009 Bracket Post-Cut Rate >$0 2.10% >$25,000 5.25% >$50,000 6.40% The corporate cut also eliminated two unnecessary brackets, and is estimated to reduce corporate tax collections by $10 million per year. The individual income tax cut is estimated to reduce collections by $90 million per year. Also enacted was property tax relief imposing a statewide rate cap and mandating reductions to be backfilled by state funds. $295 million has been reserved for the purpose for 2011-13. Missouri’s House of Representatives on April 30 also passed a bill to cut each individual income tax bracket by 0.5 percentage points, retroactive to January 1, 2009. The bill has not yet been voted on by the State Senate.
