Retired state worker questions earnings tax issue

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ST. LOUIS – For nearly 29 years, Rick Stamper traveled the country auditing insurance companies for the Missouri Department of Insurance.

“The Department of Insurance is physically located and addressed in the Truman building in Jefferson City. That’s our home base. Not the city of St. Louis,” said Stamper.

Now retired, Stamper says that detail took on added importance when the Missouri Department of Insurance issued this memo he shared with us.

It states that effective Jan. 1, 2015, the department will withhold a 1 percent St. Louis City and Kansas City earnings tax from the paychecks of all insurance division employees domiciled in the St. Louis and Kansas City offices.

“So we wanted to know No. 1, who made that decision and No. 2, why? Neither one of those questions were ever answered,” Stamper said.

Stamper said that prior to 2015, the state did not withhold a 1 percent earnings tax required of employers doing business in the city of St. Louis and Kansas City.

Fox 2 reporter Mike Colombo asked, “Would you pay city earnings tax for the days you worked at the Wainwright building prior to 2015?”

Stamper replied, “No.”

“Several of us made verbal inquires through the management channels starting with our management people in the Wainwright and then up the ladder to the management people in (Jefferson) City,” Stamper said.

“Basically, the de facto response from the Department of Insurance was, ‘we don’t have to tell you why. And we’re not going to tell you why.’ ”

Colombo contacted the Missouri Department of Insurance with two questions. The first question was why, according to Rick Stamper, did the Department of Insurance employees not withhold the 1 percent earnings tax until 2015?

The second question was what changed in 2015 that led the department to withhold the tax?

The department responded in a statement saying, “Employees were subject to any tax that was required by law. In an effort to promote consistency, the Department issued the memo. The memo provided them with instructions based on the Department’s interpretation of the city’s tax rules.”

Since that statement did not answer either question, Colombo requested an interview with Grady Martin, the man who sent that 2015 memo. That request was declined.

“Why did something not apply for 24 years, and in the 25th year, it mysteriously appears,” Stamper said.

“Now it does apply. There’s something wrong with that picture. And so we start asking and we’re denied any type of response. That looks bad.”

Colombo also asked the collector of revenue in both St. Louis and Kansas City about this situation.

St. Louis officials were unaware of any tax that wasn’t previously paid or what may have changed in 2015 when the Missouri Department of Insurance started withholding the tax. 

Kansas City officials said they couldn’t comment, but added that only active-duty military are exempt from the earnings tax.

If you have information about this situation, contact Mike Colombo at 314-213-7869 or at mike.colombo@tvstl.com.

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