The Missouri Chamber of Commerce and Industry is backing a bill that would help incentivize investment in startup businesses across the state.
Known as the “Missouri Angel Investment Incentive Act,” HB 2226 is sponsored by Rep. Travis Smith (R-Dora). During a hearing before the House Financial Institutions Committee, Smith said, “My goal is to make our state the place where new and small businesses can plant their roots and grow in our soil.”
Smith described an angel investor as an individual or group which uses its own money to provide capital for a business startup, usually in exchange for ownership equity.
“These tax credits would encourage angel investors to make their own investments into startups,” Smith said. “We should realize that an angel investor is risking their own money.”
Smith said there would be a cap of $6 million in tax credits available and a single investor could receive credits up to $300,000.
In order to ensure rural entrepreneurs have as much of an opportunity to receive these credits as those in urban areas, Smith said the state would be divided into four sections with St. Louis and Kansas City each having a section and the rest of the state being divided between north and south of the Missouri River.
The tax credits would have a 10-year sunset. The Missouri Technology Corporation, which is part of the Missouri Department of Economic Development, would administer the program.
“To date, 31 other states have angel investment credits, including seven of the eight states that touch our border,” Smith said. “Young people leaving our state and going to Arkansas or Kansas to start their businesses is the driver for me to get this bill passed.”
Heidi Geisbuhler Sutherland, director of legislative affairs for the Missouri Chamber, told legislators, “Missouri is a nationally recognized technology and innovation hub, but it can still be really tough to get a startup off the ground in this state. We’re supportive of this bill because it incentivizes investors to devote resources to these new businesses and help them be successful.”
For more information, contact Geisbuhler Sutherland at hsutherland@mochamber.com or (573) 634-3511.
