On April 7, 2026, St. Louis, Missouri voters approved Proposition E to continue the city's 1% earnings tax for an additional five-year period. The ballot question was placed before voters through Board Bill 100, enacted as Ordinance No. 72067, which provides that the earnings tax continues if approved by a majority of voters.

Background

The earnings tax is administered by the St. Louis Earnings Tax Department and is a 1% withholding tax applicable to the wages of St. Louis resident employees regardless of their work location and nonresident employees working within the city. Employers operating within St. Louis are also subject to a payroll expense tax of 0.5% on wages earned within the city.

Employers generally file both the earnings tax and the payroll expense tax quarterly using Forms W-10/P-10.

Ernst & Young LLP insights

Employers should continue to pay the St. Louis payroll expense tax and withhold the earnings tax based on the established guidelines.

Employers with remote or hybrid work arrangements should ensure payroll processes correctly distinguish between city residents and nonresidents and accurately capture whether services are performed within city limits, as the St. Louis earnings tax liability is determined by residency or the physical location of work performed.