FORWARD MOVEMENT

INCOME TAX REFORM: HJRs 173 AND 174

Lawmakers approved a constitutional amendment for voter consideration that would authorize the eventual elimination of Missouri’s individual income tax. The measure represents the most significant advancement of income-tax reform in Missouri in years and ensures that the future of the state’s tax system will ultimately be decided by voters.

• Asks Missouri voters to decide whether the state should pursue eventual elimination of the individual income tax
• Allows lawmakers to modernize Missouri’s sales tax system as part of future income tax reductions
• Requires local governments receiving additional sales tax revenue to reduce other local taxes

OCCUPATIONAL LICENSING: SB 1233

Expanded opportunities for experienced professionals moving to Missouri by creating a pathway to temporary licensure for individuals with at least three years of work experience in a profession from a state that does not require a license for that occupation.

HEALTH CARE: HB 2372, HB 2974, SB 878, AND SB 1233

• Removed outdated barriers, allowing more patients to establish provider relationships remotely
• Eased restrictions on prescribing medications through telehealth
• Expanded access by allowing providers licensed through reciprocity to serve Missouri patients statewide
• Expanded pharmacist authority to test and treat for common illnesses and prescribe certain medical devices

MORE WORK TO BE DONE

Despite extensive discussion, several major policy proposals were left unresolved at the close of the 2026 legislative session.

EDUCATION REFORM

Legislation intended to address Missouri’s reading crisis passed in the House but died in the Senate. Meanwhile, 42 percent of the state’s fourth graders can barely read—the worst results in 20 years.

• Literacy reform
• A–F school accountability grades

TAX AND BUDGET REFORM

• Property tax reform
• Spending restraint

The debate over Missouri’s future did not end with the adjournment of the legislative session. Voters will soon weigh in on income tax reform, and lawmakers will return next year facing unresolved questions about education, taxation, and government spending. The most difficult reforms still lie ahead.

Download a copy of the report here.

The post 2026 Legislative Session Report appeared first on Show-Me Institute.

Missouri’s universal reciprocity regime allows most licensed professionals from other states to have licensing requirements waived when they relocate to the Show-Me State. But what happens when a professional moves to Missouri from a state that does not license their occupation at all?

Senate Bill 1233 creates a new pathway for those individuals. Specifically, it offers a temporary license to individuals with at least three years of work experience in an occupation or profession in states that do not require a license.

For example, Missouri is one of 31 states that requires a license to work as a sign-language interpreter. Without SB 1233, if a sign-language interpreter with three years or more of experience from one of the 19 states (and the District of Columbia) that don’t require licensing moved to Missouri, they would have to spend the time and money to acquire a license before they could work here.

This bill would allow experienced professionals to continue working while pursuing a permanent Missouri license.

There are still additional improvements that can be made in occupational licensing. For example, in the licensing reciprocity process, relevant oversight bodies can still wait up to six months to issue a waiver for an applicant. A six-month waiting period is far too long.

Every occupational license carries real costs, including the loss of time and income while waiting for approval. The central question in occupational licensing is whether these costs are justified by clear and demonstrable benefits to public safety or product quality.

SB 1233 lowers the costs for experienced professionals from license-free states. It also lowers barriers to entry, which can increase the supply of professionals in different sectors and place downward pressure on prices for consumers. Missouri policymakers should continue to evaluate which existing licensing requirements function as legitimate safeguards and which function primarily as barriers to entry and work.

The post Missouri Takes Another Step Forward in Occupational Licensing appeared first on Show-Me Institute.

The article explains the current rules:

St. Louis County regulations require a one-to-one ratio of apprentices to licensed journeyman plumbers, plus one apprentice for a master plumber. For example, if a plumbing company has nine journeyman plumbers and one master plumber – the latter being required by the code – it can only hire 10 apprentices.

That ratio is too strict, especially as the retirement rate continues to tick up, [Matt] LaMartina said. Plumbing companies need to be able to hire more apprentices who will become licensed journeyman plumbers, and it’s expensive to do so now because an apprentice has to work side-by-side with a licensed journeyman plumber for up to five years before he or she becomes a licensed journeyman plumber, he said.

There is one thing to remember about all occupational licensing. It is always proposed under the guise of “public safety,” but in reality it is often about increasing wages and profits for those already in the industry. This is true for the most absurd licenses and for the legitimate ones.

Predictably, the plumber’s union is opposed to easing licensing burdens and is using the “public safety” angle:

Christopher “Brian” Chumley, a business representative for Local 562, said he hopes the code review committee does not change the ratio. Weakening the plumbing code would endanger public health, he said.

Just to be clear, there is absolutely no evidence that adjusting the number requirements slightly to allow one current plumber to supervise a few more apprentices would “endanger public health.” In fact, one study found that more strict licensing of electricians actually led to more electrocutions, so it is really just the opposite. (Strict licensing leads to higher prices, which leads to more do-it-yourself work, which leads to more electrocutions.) Thankfully, plumbing, while difficult, is not as deadly, so the effects are not as drastic. Does licensing improve safety for the plumbers themselves? Nope, that question has been studied, too.

The purpose of strict plumber licensing (and other trades, too) in St. Louis County and elsewhere is to restrict trade and increase wages for the plumbers, especially the union members. Everything else is a smokescreen. St. Louis County, and every county in Missouri, should reduce its licensing rules for plumbers and many other occupations to make hiring and training for new jobs easier. The same thing goes for occupations licensed by the state, such as barbers and cosmetologists.

The post St. Louis County Should Reduce Plumbing Licensing Rules appeared first on Show-Me Institute.

With Kansas City preparing to host matches during the 2026 FIFA World Cup, Missouri lawmakers are considering a bill to simplify food truck licensing in Jackson County. The proposal would allow vendors licensed by the county to operate in any municipality without additional city permits.

The change would remove a common barrier: multiple permits just to cross a city boundary.

The idea makes sense. But if it will help entrepreneurs and visitors during the World Cup, why should the same principle not apply across Missouri? As the Squirrel Nut Zippers sang, “If it’s good enough for Grandad, its good enough for me.”

Food truck regulations vary widely by city. Vendors operating across a metro area may face requirements for multiple permits, fees, and regulatory approvals.

Show-Me Institute writers have written about these barriers for years. In 2019, we noted that St. Louis food trucks still faced significant regulatory constraints despite growing demand. Food trucks offer a flexible and relatively low-cost entry into the restaurant business, but local regulations can make that opportunity harder to pursue.

In some places, additional rules beyond health and sanitation standards function as a de facto ban on mobile vendors.

Health and safety regulations would remain under the proposal being considered in Jefferson City. Missouri already regulates food safety through inspections and sanitation standards administered by local health departments.

The real issue is duplication. Requiring vendors who already meet health standards to obtain a license in every municipality adds cost and delay without improving safety.

Every occupational license carries costs: higher prices for consumers, barriers to entry for workers, fewer providers, and lost time and money for licensees. The central policy question is whether those costs are justified by clear benefits to public safety or product quality.

Several Missouri communities have taken steps to loosen food truck restrictions in recent years. Clayton, for example, expanded opportunities for food trucks to operate at events and public gatherings while maintaining basic safety requirements.

Such changes recognize that mobile vendors are part of the broader restaurant ecosystem and often serve as a first step toward larger businesses.

Starting a small business often requires navigating numerous regulatory steps and fees. Reducing unnecessary barriers can make it easier for entrepreneurs to test new ideas and serve customers.

That flexibility helps explain the popularity of food trucks: vendors can move where demand is strongest, serve events, and test new concepts without the overhead of a traditional restaurant.

Major events like the World Cup highlight that advantage. When large numbers of visitors arrive, mobile vendors can help meet the temporary surge in demand for food and entertainment.

But the benefits of reducing unnecessary regulation should not depend on an international sporting event. If getting government out of the way helps vendors serve World Cup visitors in Kansas City, it should also help them serve customers across the rest of Missouri.

The post If Food Truck Reform Is Good for One County, It’s Good for All appeared first on Show-Me Institute.

Senate Bill 895 would continue to strengthen Missouri’s occupational licensing laws. The bill mirrors SB 61 from last session (which nearly reached the governor’s desk), and would establish a form of licensing reciprocity for professionals who were not required to hold a license in their previous state but must obtain one when moving to Missouri.

The Mechanisms and Potential Intent of SB 895

There’s been a recent push in Missouri to join interstate compacts for various professions. While those may make things easier for Missouri’s licensing boards, they primarily help people leaving Missouri to work in other states. This bill focuses on making it easier for people to come here.

Specifically, SB 895 would allow professionals who have been working for three years in states that do not require a license to receive a two-year, nonrenewable, temporary license in that same field when they move to work in Missouri.

Oversight bodies can still charge fees and require that applicants take license-related exams. The goal of this bill does not appear to be reducing licensing requirements, but to allow people who move to Missouri to work during the process of acquiring a license. This is evidenced by a provision that requires the individual to complete Missouri requirements and apply for a permanent license once their temporary license expires.

Currently, unlicensed professionals would need to apply for a permanent license if they were to relocate to Missouri, so SB 895 would certainly improve the status quo. But it also forces us to consider why Missouri requires a license in certain occupations when other states do not.

Considering What Missouri Licenses

With every single occupational license, there are real costs: higher prices for consumers, higher barriers to entry for workers (resulting in fewer providers), reduced innovation, and loss of time and money for licensees. The central question in occupational licensing is whether these costs

are justified by clear and demonstrable benefits to public safety or product quality.

It is not unprecedented for Missouri to require unnecessary and burdensome licenses. For example, our state recently reformed licensing requirements for hair braiders.

Over the past few years, our annual Blueprint has included a section outlining the need for a review of Missouri’s existing occupational licenses. Many licenses are created and then exist for years without scrutiny. Licenses that are found to do more harm than good ought to be eliminated.

SB 895 would be another step toward improving Missouri’s existing licensing regime. However, if individuals are permitted to work in other states without a license, Missouri should carefully evaluate whether a permanent license is truly necessary here. Our state has been a leader in occupational licensing reform, and we should continue that trend.

The post Another Step for Improving Missouri’s Licensing Regime appeared first on Show-Me Institute.

House Bill 2274: Increasing Mobility for Teachers

On January 15, Show-Me Institute Senior Policy Analyst Avery Frank submits testimony to the Missouri House Elementary and Secondary Education Committee regarding an interstate teacher mobility compact.

To the Honorable Members of This Committee

Thank you for the opportunity to testify. My name is Avery Frank. I am a senior policy analyst at the ShowMe Institute, a nonprofit, nonpartisan, Missouri-based think tank that advances sensible, well-researched, free-market solutions to state and local policy issues. The ideas presented here are my own and are offered in consideration of fostering flexibility in Missouri’s public education system.

Reducing Uncertainty for Out-of-State Teachers

In 2020, Missouri adopted a form of universal licensing reciprocity allowing most licensed professionals (with some exceptions) who have held a valid license issued by another state for at least one year to practice in Missouri at the same occupation or level, meaning that they would have Missouri examination, educational, or experience licensing requirements waived.¹

Teachers are among the many licensed professions in Missouri, and this reciprocity regime is beneficial as it currently stands. However, uncertainty remains for many out-of-state teachers who may seek to relocate to Missouri. For example, which Missouri teaching license is equivalent to their current out-of-state license?² Additionally, existing statute allows relevant licensing authorities up to six months to issue a licensing waiver.³ Together, these uncertainties can reduce Missouri’s attractiveness as a place to move and teach.

House Bill 2274 would establish the Interstate Teacher Mobility Compact in order to address these challenges. If enacted, the compact would require each participating state to create and maintain a list of licenses it is willing to consider for equivalency. This would help teachers more clearly understand their potential teaching options and reduce uncertainty when considering relocation.

The interstate commission created by the compact would primarily function as a clearinghouse, or central information-sharing hub, for licensure and disciplinary information. Each state would retain full authority over who is licensed within its borders and under what conditions. While Missouri already provides a broad pathway for recognizing many out-of-state licenses, the compact would provide additional transparency and consistency that could make the state more attractive to prospective teachers.

Helping Address Teacher Shortages in High-Need Subject Areas and Schools

Missouri’s teacher shortage has received significant attention in recent years⁴. A closer examination of the state’s pipeline and hiring trends suggests that Missouri does not face a broad, statewide shortage of teachers. Instead, shortages are concentrated in specific subject areas and in particular high-need, challenged districts.⁵ 

For example, between the 2017–18 and 2021–22 school years, the Hickman Mills C-1 school district reported a substantially higher percentage of vacant teaching positions than other Kansas City–area noncharter public school districts—more than five times higher than the second-highest district, Kansas City 33.⁶

While the compact alone will not provide a targeted solution to these types of deficiencies, it should improve Missouri’s overall teacher pipeline by making it easier for qualified out-of-state teachers to fill vacancies in hard-to-staff schools and subject areas, such as special education or physics. Kansas is already a member of this compact, and facilitating mobility for teachers living near the Kansas–Missouri border could benefit western Missouri districts in particular.⁷

Conclusion

House Bill 2274 offers an opportunity for Missouri to continue leading on occupational licensing reform while modestly improving access to qualified teachers in areas of greatest need. For these reasons, this bill could help make Missouri a better place to teach and live.

The post An Interstate Teacher Mobility Compact appeared first on Show-Me Institute.

The post Licensing Requirements for Speech-Language Pathologists appeared first on Show-Me Institute.

Needless occupational licensing requirements make it harder for people to work in our state, and wait times for licensing waivers unnecessarily burden applicants.

The Solution

Periodic review of all licensing requirements, elimination of regulations without proven benefits to public safety or product quality, and reduction of the maximum time to receive an out-of-state licensing waiver.

Licenses Should Have Proven Benefits

Occupational licensing is the government giving someone permission to work in a certain field. Obtaining a license typically involves satisfying an educational requirement and paying a fee.

Most licensing laws are justified as public safety measures or as necessary to ensure the quality of the relevant service. However, there is little evidence that occupational licensing laws provide any benefit in this regard, as demonstrated by the Mercatus Center at George Mason University in a meta-analysis of 19 different studies directly related to licensing and product quality. In only 16% of included studies did researchers observe positive relationships between licensing and product quality.

Occupational licenses raise prices, impose higher barriers to entry, cost licensees time and money, and reduce innovation. Because of these costs, an occupational license should provide a proven benefit to public safety or product quality.

Issuing Waivers Efficiently

2020 marked the establishment of Missouri’s licensing reciprocity regime. Under current law, any person who has held a valid license issued by another state for at least one year can practice in Missouri at the same occupation or level with all Missouri licensing requirements waived.

However, the relevant oversight body can wait up to six months to issue a waiver to an applicant. A worker considering relocation to Missouri might not be able to wait half a year before starting work in the profession in which they’ve been trained. This delay puts applicants in a bind: Either wait for a waiver during this extended period or meet the Missouri licensing requirements so they can work. This reality may dissuade individuals from relocating to Missouri entirely.

Missouri provides an expedited licensing timeline for qualified spouses of law enforcement officers and members of the military. This is a step in the right direction, but all professionals seeking work in Missouri should have their applications reviewed in a timelier manner.

Key Facts

• Five percent of the U.S. workforce was licensed through state laws in 1950. In 2024, 22% are licensed.

• In Missouri, it only takes an estimated 26 days of education and experience to become an EMT, but 175 days to become a makeup artist.

Sunset Reviews for Occupational Licenses

Many licenses are created and then exist for years without scrutiny. Not all licenses justify the costs they impose; in fact, Missouri has eliminated a number of unnecessary licenses, such as licenses for hair braiders. A sunset provision would bring attention to other outdated and unnecessary requirements, helping ensure that only those with proven benefits remain.

Reducing the burden of occupational licensing could create opportunities for workers and consumers, lower prices, and increase economic growth. Licensed occupations should be the exception, not the rule.

Policy Recommendations

• Establish a staggered sunset and review period for all professional licenses and licensing boards.

• Reduce the maximum waiver review time from six months to 45 days.

The post Occupational Licensing appeared first on Show-Me Institute.

Healthcare supply is needlessly limited by regulations that often protect incumbent providers at the expense of patients.

The Solution

Enact free-market reforms to increase the availability of care across the state while also working to lower healthcare prices.

Key Facts

• Missouri needlessly restricts many medical professionals’ scopes of practice and has complex licensing requirements that reduce healthcare access.
• During the COVID-19 pandemic, Missouri was a national leader in waiving laws and regulations that placed unnecessary limits on healthcare access.

Remove Unnecessary Barriers

“Scope of practice” defines what medical professionals can do in a state, given their training. More treatment options for patients means more competition among providers, which is good for consumers in terms of service and price. This is especially true and important in rural areas where doctors may not always be available or nearby. While Missouri has made some incremental progress on broadening the scope of practice for nurses in recent years, the state still has more restrictive laws than most of the country.

“Telemedicine” is the provision of medical care over the telephone and the internet. For the sake of public health and because many patients felt more comfortable staying at home during the pandemic, Missouri temporarily loosened the regulations that govern who could see a physician online and under what circumstances. Despite the recent expansion of Missouri’s telemedicine laws to include audio-only technologies, there is still work to be done to safely expand telemedicine.

“Licensure” is the manner in which the state regulates certain professions. Unfortunately, licensure can often act as a barrier to entry, especially for qualified healthcare providers from other states. While Missouri’s passage of universal license reciprocity in 2020 was a step in the right direction, the state’s licensing laws are still unnecessarily limiting the number of qualified and willing providers who could otherwise be treating Missouri patients.

Repeal Certificate of Need

Missouri’s Certificate of Need law restricts healthcare competition by requiring many healthcare providers to get state approval before entering new markets or expanding services offered in existing facilities. This restriction hampers market newcomers and puts upward pressure on healthcare prices by restricting supply.

Retake a Top Spot

At the start of the COVID-19 pandemic, Missouri quickly became a national leader in expanding healthcare access. Governor Parson waived numerous laws and regulations regarding scope of practice, license reciprocity, telemedicine, and even Certificate of Need requirements. But in the years since, the waivers were allowed to expire, and Missouri’s legislature has taken minimal action to address the issue.

Missouri’s laws and regulations that specify what the state’s providers are allowed to do and where they can practice play a key role in the recruitment of new state residents and workers. Greater freedom for providers makes job opportunities in a state more desirable for prospective employees. If Missouri’s elected officials are serious about addressing the state’s healthcare access issues, making healthcare employment in Missouri more competitive is required.

Policy Recommendations

• Remove the unnecessary barriers to healthcare access that were previously waived during the COVID-19 pandemic, such as expanded providers’ scope of practice.
• Remove the statutory delays to reciprocity licensure and create additional pathways for licensed healthcare providers in other states to treat patients in Missouri.
• Repeal Missouri’s Certificate of Need laws.

The post Free-Market Healthcare Reform appeared first on Show-Me Institute.

In 2001, a group of very libertarian-minded activists launched the Free-State Project, which encouraged thousands of libertarian believers in minimal government to move to New Hampshire. The overall success of the project has been limited, for a variety of reasons, but if imitation is the sincerest form of flattery, then I’d like to see people in Missouri flatter the Granite State and try to do a similar thing here in one of our many cities.

What would such a limited-government, free-market oriented municipality look like in Missouri? To start with, it should be modeled on successful, small-government municipalities like Weston, Florida, and Sandy Springs, Georgia, which provide many local services by contracting with the private sector. It should not be based on the more radical, no-government “utopias” like Grafton, New Hampshire, where the removal of almost all government services led to an increase in bear attacks.

How many limited-government activists would it take to create a free city in Missouri? Not very many. There are hundreds of existing municipalities here with less than a hundred residents where, at most, a few dozen show up to vote in local elections. If, say, 50 true free-market believers moved into one city, what types of changes could they make to create that desired free city?

To start with, they could remove all municipal planning and zoning rules and replace them with private contracts managed by property-owner associations where allowed. Those property-owner associations could manage issues like short-term rentals, trash collection, and home-based businesses.

Municipalities, especially small ones, could focus on contracting with larger cities or counties to provide many services, like policing or building inspections. The new free city could contract with private companies to provide many other services, like trash collection and recreation management. It could similarly contract with nonprofits for some other services where profit opportunities are limited, such as animal shelters. If it had municipal utilities, it could privatize them into regulated, private utilities. The free city could reduce local code requirements, permitting rules, and occupational licensing to the largest extent possible. The important ones, like fire codes and elevator inspections, could be kept, while arbitrary or obsolete regulations, like television repairman licenses and pool-table taxes, could be thrown out.

None of these examples are farfetched. Every one of the above examples is already in place in a city somewhere in Missouri. Private utilities provide water, gas, and electricity to millions of Missourians. Cities contract with counties and other cities for services all over the state. In St. Louis County, every municipality (88 at last count) contracts with the county for at least some inspection services. Nonprofits provide important services to the public, like Pinnacles Youth Park near Columbia, and operate many animal-care facilities. Private businesses operate city-owned golf courses and manage municipal swimming pools throughout the state.

How would a free city fund these services? It would maximize private contracts between residents and companies and enact user fees to the largest extent possible. Low general sales and property taxes could fund the rest, along with revenues shared from other sources, like the gas tax. Importantly, such a city would avoid special deals such as tax abatements or tax-increment financing, for some businesses or people. Making the sales and property tax bases as wide as possible would allow the rates to be as low as possible for everyone. This free city would absolutely avoid the errors of a local income tax such as exist in Kansas City and St. Louis.

Overall, a Missouri free-city project would create a municipal government system not all that different from those in many rural, unincorporated parts of Missouri. It would just be in a more urban or suburban setting. It may seem unrealistic to expect hundreds—or even dozens—of people to make such a move based on political philosophy. But as a model of quality, low-tax local government, it is perfectly realistic. While no city may have enacted all of these ideas, each of them has been enacted with success somewhere. We just need the right number of people to put it together all at once.

I vote we try it somewhere near the Lake of the Ozarks.

The post The Free-City Project for Missouri appeared first on Show-Me Institute.

What Is the Compact Exception, and Why Does It Matter?

Currently, state law allows most professionals licensed in other states who relocate to Missouri an expedited path to receiving an occupational license. If the professional has been licensed for at least one year and remains in good standing, Missouri’s occupational licensing bodies must waive the state’s requirements and issue a license within six months of application.

This makes it easier for workers to relocate to Missouri. However, two key weaknesses remained:

• The relevant oversight body can wait up to six months to issue a waiver for those who meet the reciprocity guidelines.
• According to the old statue, Missouri’s licensing reciprocity “shall not apply to an oversight body that has entered a compact with another state for the regulation of practice under the oversight body’s jurisdiction.”

The second issue—the “compact exception”—was addressed by the recent passage of Senate Bill (SB) 150. SB 150 resolves this issue entirely.

Under the current language, if a Missouri licensing board joins a compact, it could actually make things worse for Missouri consumers. For example, all states require cosmetologists to have a license. Today, Missourians could have access to cosmetologists moving from all 50 states, because licensing requirements would be waived in our state. Now suppose Missouri joins a cosmetology compact that only has six member states. Due to the compact exception, licensing reciprocity would not apply to the other 43 states that have not joined the cosmetology compact (unless the language of the compact explicitly says otherwise).

Let’s Keep the Momentum Going in Occupational Licensing

SB 150 also expedites licensing timelines for qualified spouses of law enforcement officers moving to Missouri. The bill mandates that spouses of law enforcement officers who have a professional license in another state and remain in good standing receive a temporary license for their occupation in 30 days or less. Currently, this expedited process is only available to spouses of military members. This change in SB 150 points to the need for broader reform. As mentioned earlier, Missouri law allows the relevant oversight body to issue a reciprocal license in six months or less. Six months is far too long to wait to begin working, and all professionals seeking work in Missouri should have their applications reviewed in a timelier manner.

SB 150 eliminates one weakness of Missouri’s universal licensing reciprocity regime. It is a meaningful win, and hopefully we’ll see more reform in the future to make Missouri a more attractive state to move to.

The post Licensing Compact Exception Is Removed in Missouri appeared first on Show-Me Institute.

Here’s an overview of some of the legislation passed this session (some of which is still awaiting the governor’s signature):

$50 MILLION FOR MOSCHOLARS PROGRAM

• First public investment in the K–12 scholarship program, with $50 million approved in the state budget
• Could triple the number of students served, expanding access to private school, homeschooling, and
specialized support

TELEHEALTH AND HEALTH CARE REFORMS: SB 79

• Improves telehealth access by allowing both audio-only and audiovisual services on any HIPAAcompliant
platform
• Expands health benefit offerings by allowing certain organizations to offer health plans to members,
sometimes referred to as farm bureau or association health plans, without many of the burdensome state
and federal restrictions that apply to traditional insurance offerings

PROTECTING PROPERTY RIGHTS: HB 595 AND HB 343

• Prohibits cities and counties from requiring landlords to participate in voluntary federal housing
programs such as Section 8 housing vouchers
• Bans caps on security deposits and restrictions on tenant screening criteria like income, credit, and
criminal history

CAPITAL GAINS TAX EXEMPTION: HB 594

• Exempts 100% of long-term capital gains from Missouri state income tax for individuals
• Applies to all individual income reported as capital gains for federal tax purposes, starting tax year 2025
• Designed to encourage investment and entrepreneurship by reducing the tax burden on productive
activity

EXPANDING LICENSE PORTABILITY: SB 150

• Expands access to temporary occupational licenses across most licensed professions in Missouri by
repealing the harmful compact exemption, ensuring that more professionals moving to Missouri can
start working without unnecessary delays
• Provides expedited occupational licenses to law enforcement spouses moving to Missouri, allowing
those licensed in another state for at least one year and in good standing to receive a Missouri license
within 30 days of applying

Download a copy of the report here.

The post 2025 End of the Legislative Session Report appeared first on Show-Me Institute.

The Current State of Occupational Licensing in Missouri

In 2020, Missouri adopted a form of universal licensing reciprocity, allowing most professionals (there are some exceptions) who have held a valid license issued by another state for at least one year to practice in Missouri at the same occupation or level, and have all Missouri licensing requirements waived.

However, this policy has a little-known exception, known as the “compact exception,” which states:

[Reciprocity] Shall not apply to an oversight body that has entered into a licensing compact with another state for the regulation of practice under the oversight body’s jurisdiction.

A licensing compact is an agreement between multiple states to recognize each other’s licenses, but it is governed by its own set of rules and oversight. One reason that licensing boards like to join compacts is because it makes it easier to process new licensure applications. These compacts act as a central hub with all the information needed for processing the application.

However, due to the “compact exception,” joining certain compacts can increase the regulatory burden in Missouri.  This is because the compact exception overrides universal reciprocity, and boards can limit eligibility to only its member states and those following the compact’s rules. In such cases, licensing reciprocity only extends to workers from other states in the compact, instead of any qualified and licensed person who wants to move to Missouri and begin working. Yet, some compacts explicitly preserve reciprocity and state regulations, and allow the compact to serve as a voluntary option for licensing. Given this, officials must carefully evaluate how each compact would treat our universal licensing regime if passed.

Different Missouri Compacts

Senate Bill (SB) 109 is one compact that may not fall into the trap of increasing the regulatory burden in Missouri. While this compact only has 10 member states, it appears that this compact is voluntary and serves as one option to streamline the transition for dentists and dental hygienists across state lines. It states:

Allows each state to continue to regulate the practice of dentistry and dental hygiene within its borders;”

“Eligibility or ineligibility to receive a Compact License Privilege shall not limit the ability of a Licensee to seek a state license through the regular process outside of the Compact.

Since this compact does not appear to supersede Missouri’s licensing reciprocity, it wouldn’t negatively affect people moving to Missouri.

Always Read the Fine Print on Licensing Compacts

In theory, compacts should make it easier for Americans to move all around the country, but some act as a pathway for asserting regulatory control. A compact can be used by interested industries to raise licensing requirements in states that cut back on regulation, increasing costs for both consumers and potential entrants alike. It is important to read the fine print to ensure that our universal licensing reciprocity is not superseded.

The post Why Does Missouri Want to Keep Joining Compacts? appeared first on Show-Me Institute.

The origins of these restrictions date back to the Progressive Era of American history, a time when occupational licensing was implemented to prevent the spread of barber’s itch (a contagious staph infection of the hair follicles). At the time, it was believed that the additional step of a license to operate a barbershop, emphasizing standards such as sterilization and sanitation, would combat the spread of barber’s itch. Then, in the 1940s, more restrictions were placed on barbers, resulting in a law that restricted the hours of operation.

Despite the good intentions behind requiring barbers to obtain an occupational license, a multitude of studies suggest that occupational licensing laws have a minute effect on quality and simultaneously eliminate cheaper options for consumers. Additionally, restrictions on hours of operation prevent barbers from servicing all their clients. As Beverly Smith, owner of Artichely Hair Academy, noted:

And the reason why is because it would not allow us to do as many clients as we need to, because people work from nine to five. . . . And we can’t fit all the clients in on a Saturday.

Thankfully, the St. Louis Board of Aldermen passed Board Bill 103 12–0, repealing the mandatory 6:30 closing time and the prohibition on operating on Sundays and certain holidays.

While the bill does not repeal statewide occupational licensing for barbers (nor does the city have that power), it is a significant step in the right direction. If the board of aldermen chooses to pursue this path further, it should consider reviewing the licensing requirements for other occupations too and evaluate whether the local occupational regulations genuinely serves as a quality marker, given that studies indicate otherwise. As is often the case, the market is better at ensuring the quality of a shave or haircut or signaling the appropriate hours of operation for barbers. By continuing to reevaluate these regulations, the city can foster a more competitive environment that benefits both barbers and consumers alike.

The post Good News for Men’s Hair in the City of St. Louis appeared first on Show-Me Institute.

In recent years, several studies have also suggested a positive correlation between an increase in the minimum wage and property crime (such as burglary, larceny, and auto theft) committed by young adults, who are disproportionately impacted by an increase in the minimum wage. But why would a minimum wage increase lead to an increase in property crime?

The hypothesis is that when minimum wages increase, low-income and low-skilled workers experience a reduction in hours worked or increased unemployment, which often means a loss of income. The authors conclude that this decrease in earnings, reduction in hours worked, and increase in unemployment contribute to increases in property crime rates.

The effects of raising the minimum wage are particularly felt by workers who are younger, have a lower income, and are less skilled. The Journal of Economics study finds:

. . . using data from the 1998–2016 Uniform Crime Reports, we find that a 10 percent increase in the minimum wage led to increases in property crime arrests for those between the ages of 16-to-24 of approximately 2 to 3 percent.

Intuitively, this makes sense—losing your job or losing hours at your job could increase economic desperation, leading people to commit property crimes such as theft. In addition, jobs help give people structure and keep them on the right track. The Journal of Public Economics study mentions that more labor market opportunities for younger workers reduce criminal behavior because it increases the opportunity cost of crime. If you have a job, you have more to lose if you get caught committing a crime.

What does this all mean for Missourians? Raising the minimum wage can not only lead to fewer hours and jobs, but also more crime. To actually benefit low-income and low-skilled workers, shouldn’t we instead pursue policies that foster an environment enabling businesses to create more jobs, such as tax cuts or eliminating unnecessary occupational licensing?

The post Does the Minimum Wage Impact Crime Rates? appeared first on Show-Me Institute.

The playbook highlights how excessive occupational licensing, convoluted permitting processes, and outdated zoning laws create significant hurdles for small business owners. For instance, starting a barbershop often involves not only obtaining city permits but also navigating state-mandated requirements such as barbering school and licensing fees, adding unnecessary time and cost. Punitive late fees, illogical license renewal cycles, and restrictive home-based business rules further complicate the landscape for aspiring entrepreneurs.

One major recommendation is the establishment of one-stop shops for business registration, such as KC BizCare, which can streamline the process by allowing entrepreneurs to complete all necessary steps in one place. This approach reduces confusion and inefficiencies, helping business owners navigate regulatory requirements more easily. Additionally, the playbook suggests cities adopt more flexible licensing terms and graduated fee schedules to lower initial costs for new businesses, particularly those started by lower-income residents.

A separate policy report written exclusively for Kansas City, Missouri, included conversations with a number of local entrepreneurs to determine the most significant barriers facing business start-ups. The report made several recommendations—including improving the KC BizCare program—and the IJ Cities Work team pledged to remain involved in Kansas City’s efforts, including collecting feedback on the success of reforms and even drafting ordinances.

The playbook underscores the importance of reducing regulatory barriers to foster a thriving entrepreneurial ecosystem. By adopting its recommendations, cities in Missouri and elsewhere can create more dynamic environments for small businesses to flourish, ultimately contributing to stronger local and state economies.

The post How Missouri and Other States Can Foster Entrepreneurship by Reforming Local Regulations appeared first on Show-Me Institute.

The Institute for Justice has identified nine occupations for which Missouri requires a license that are not subject to licensing in at least 15 states. For example, Missouri is one of 22 states that requires a license to work as a sign-language interpreter. Acquiring the license entails $442 in fees, 60 credit hours of education, and two exams. Under current statute, if a sign-language interpreter with three years or more of experience from a state that doesn’t require licensing moved to Missouri, they would have to spend the time and money to acquire a license before they could work here.

SB 817 would not waive licensing requirements for these sign-language interpreters, but it would provide access to a temporary license (if an individual has already worked for three years in the relevant field) while they satisfy Missouri licensing requirements.

Oversight bodies can still require that applicants take license-related exams and charge fees. The goal of this bill does not appear to be reducing licensing requirements, but allowing people who move to Missouri to work during the process of acquiring a license.

I think this bill would improve the status quo. However, I still do not think those who are experienced in their field need to waste time and resources fulfilling licensing requirements. SB 817 has language that says:

Upon expiration [of the temporary license], the individual shall be required to apply for a permanent license in accordance with the license requirements for the occupation . . .

SB 817 has some good qualities, as it makes it easier for people to work in our state. However, we are still left with the question of why Missouri imposes licensing requirements at all when other states do not. Moreover, if a person has three years of work experience in a field, why is Missouri requiring that they jump through additional hoops? Absent a showing of a real health or welfare concern, it looks as if Missouri is just protecting revenue streams to special interests. Shouldn’t lawmakers consider changing this bill to waive these extra bureaucratic hoops and encourage more people to come to work in Missouri?

The post Temporary Licenses for Out-of-state Workers appeared first on Show-Me Institute.

Occupational licensing increases costs to consumers and people entering the workforce, favors politically influential groups, and serves, in most cases, as a protectionist measure designed to benefit incumbent practitioners of the licensed occupation at the expense of future practitioners and the public. Show-Me Institute analysts have long written about the harms of occupational licensing in Missouri.

While we may finally be moving in the proper direction of less licensing, there remains a bureaucratic minefield of licensing apparatchiks who have to justify their positions on the public payroll. They do so by filing absurd cases like this one involving dentistry in Bridgeton. (For the record, one study found that dentists’ incomes and dental prices were 12 to 15 percent higher in states with more restrictive dental licensing rules.)

In Bridgeton, we have someone replacing rubber bands on braces—which many people simply do themselves. My son does it with his braces every day. You don’t need a dentist to replace a rubber band any more than you need an orthopedic surgeon to autograph an arm cast.

The second part of the case is, I admit, more complex. This person being sued has also apparently been applying cosmetic veneers to teeth.  They are, as the link describes, entirely cosmetic procedures. Why can’t this person apply veneer to a willing customer? Provided that her customers are fully informed that she is not a dentist, I see no problem with any of this. The article gives zero indication that anyone has been harmed. It simply appears that someone—possibly a dentist with nothing better to do—came across the ads and filed a complaint.

There could also be a middle ground here. Perhaps a basic license similar to those required for nail salon technicians could be required for cosmetic veneer sales instead of a full dentist license. That is another thing about occupational licensing: even in cases where it may be beneficial, the government goes way beyond what it needs to do in order to get the other aspects (usually protectionism), into the mix. Taxi cab licensing is a perfect example of this.

This lawsuit seems to me to be another overreach of licensing boards in Missouri. I hope the lawsuit gets tossed, but I also hope this goes the way of hair braiding laws and the legislature fixes the licensing rules here.

The post A Thin Veneer of Protectionism appeared first on Show-Me Institute.

Missouri passed universal licensing reciprocity in 2020, meaning licenses from all other states can be used in Missouri. For example, 37 states across the country require licensure to be a makeup artist. Licensing reciprocity means that anyone who has a license in one of the 37 states can have Missouri licensing requirements waived when they move to Missouri to be a makeup artist. This policy lowers barriers to entry for professionals and in turn, increases the supply of workers and services. With increased supply and competition, quality increases while prices decrease.

However, Missouri legislators have taken the DeLorean and gone back in time by sending two bills (Senate Bill (SB) 157 and SB 70) to the governor’s desk. The bills would create a new licensing compact and also have Missouri join two other existing compacts. Licensing compacts allow workers with licenses in one state to practice without additional licensing requirements in other states in the compact. These compacts are essentially a less inclusive version of licensing reciprocity. Former Show-Me Institute Analyst Corianna Baier explained the harm licensing compacts can cause:

[T]he current licensing reciprocity statute states that licensing reciprocity “shall not apply to an oversight body that has entered into a licensing compact with another state for the regulation of practice under the oversight body’s jurisdiction.” On its face, this language indicates that the license compact would overrule licensing reciprocity to the injury of Missouri consumers.

Essentially, a compact would partially cancel out licensing reciprocity. Missouri, like Mrs. McFly, is obsessing over the wrong thing. To use the makeup artist example: with reciprocity, anyone from any state (which has a license) can work in Missouri without having to get a new license; under a compact, only makeup artists from states included in the compact reap the benefits.

As Institute analysts have noted repeatedly, this glitch needs to be ironed out with a language change. If we remove the “compact exception” then Missouri can “restore the timeline” and Missouri will once again have full licensing reciprocity.

At this point you may be wondering: what is the benefit of compacts? The benefit of keeping compacts is that many other states don’t have reciprocity. For example, to practice telehealth in another state, one needs to be eligible in that state. While Missouri lets any license apply to our own state, suppose Arkansas does not have the same rules. Therefore, with the passage of the compact, a doctor in Cape Girardeau could now practice telehealth in Little Rock if Arkansas became a member of the same compact.

State regulatory boards are certainly satisfied with the expansion of compacts in our state, but our policymakers need to look out for the interests of Missouri consumers. Fixing the language that puts compacts and reciprocity in conflict would be a win for everyone in Missouri. Hopefully we will not need two more sequels to solve our issues.

The post Back to the Future on Licensing in Missouri appeared first on Show-Me Institute.

• Education reform progress
• Crime in St. Louis
• Tax credit mistakes
• “Loyalty oaths” at public universities
• Missouri students falling behind
• Occupational licensing

Click here to find the newsletter.

The post Show-Me Institute’s March 2023 Newsletter appeared first on Show-Me Institute.