Unforeseen Benefit Coming to STL?

There may be a new unforeseen benefit stemming from the AB-InBev deal. Jeremiah McWilliams over at Lager Heads is reporting that our new Brazillian neighbors may be pushing to end the 1-percent city earnings tax. McWilliams quotes from a Post-Dispatch business column by Joe Whittington:

Anheuser-Busch InBev has on tap an effort to lessen the burden of the city’s earnings tax, according to knowledgeable sources.

One source said the brewery has talked with the Bryan Cave law firm about representing them in the effort. Bryan Cave cited client confidentiality when questioned about the subject.

A call to acting City Counselor Steve Kovac, whose office would handle the matter for the city, has not been returned.

One source said the brewery is trying to “avoid a pay cut for the Brazilians coming to town.” InBev, which bought the brewery, is based in Belgium, but many of its top executives are from Brazil.

The 1 percent tax, which affects those who work in the city, represents a big lug for the city, and the brewery was identified in a financial report for fiscal 2008 as the No. 1 source of this tax in the city. Its payment totaled $7.39 million, or 4.2 percent of all earnings and payroll tax collected by the city.

Now, I’m sure that the chances of actually overturning the tax are fairly slim, but I love their ambition of lowering taxes for everyone. Of course, I say this without having read any of the legal theory underpinning the firm’s purported argument, because Bryan Cave is doing its proper legal duty and keeping its mouth shut. I’ll just have to wait with baited breath. There are, however, a few pieces on the Show-Me Institute’s website demonstrating that eliminating the earnings tax makes good economic sense.

Even if the 1-percent tax were struck down, though, I’m sure city officials would try to find another way to get “their” money.