MISSOURI REVENUE & SCHOOL FUNDING

What the official record shows

A claim about Missouri’s capital-gains tax change mixed several different numbers: state general revenue, Lottery proceeds, federal education support, and the school foundation formula. They are not interchangeable.

CLAIM 1 · GENERAL REVENUE

“Revenue increased 3.4%.”

That is not what Missouri’s official FY2026 final general-revenue report says. The report records a 2.8% decrease in net general-revenue collections: $13.43 billion in FY2025 and $13.05 billion in FY2026.

What this number is: state net general-revenue collections for the completed fiscal year. It is the relevant statewide total when the claim is about whether Missouri state revenue went up or down. The report also shows different movement in individual tax types, which is why a single percentage from one category or one month should not be substituted for the annual statewide total.

Read the Missouri Office of Administration’s FY2026 final general-revenue report →

CLAIM 2 · LOTTERY

“The loss of revenue was related to lower Lottery sales.”

Lottery sales were higher, not lower. Missouri Lottery sales rose from $1.602 billion in FY2025 to $1.657 billion in FY2026. Education proceeds were nearly unchanged: $337.48 million in FY2025 and $337.50 million in FY2026.

Lottery money is dedicated to education. The Lottery says its proceeds have gone solely to Missouri public-education programs since FY1994 and represent roughly 3–4% of total public-school funding.

That is not the same as general revenue. A change in Lottery proceeds is important to education, but it does not explain the state’s annual net general-revenue collections.

See the Missouri Lottery’s sales and proceeds history →

CLAIM 3 · FEDERAL SUPPORT

“Less federal support was the reason.”

Reduced federal support is real, but it is a separate funding stream. The FY2026 state budget lists $1.724 billion in DESE federal funds, down $676.5 million from FY2025. That decline affects DESE’s total available budget; it does not explain a drop in state general-revenue collections.

Why the distinction matters: a dollar of federal aid, Lottery proceeds, and state general revenue may all support education programs, but they come from different sources and follow different rules. A clear public discussion identifies both the fund and the fiscal year before drawing conclusions.

View the state’s FY2026 department-by-department budget totals →

CLAIM 4 · FOUNDATION FORMULA

“The foundation formula was fully funded.”

That was true for FY2026. DESE’s FY2026 announcement specifically identifies full funding of the Foundation Formula. It should not, however, be treated as a permanent answer to the broader school-funding question.

FY2026: The Foundation Formula was fully funded. That is a real and important fact.

Looking ahead: in September 2026, the State Board directed that the FY2028 Foundation Formula request remain at the FY2027 level—approximately $270 million below the amount needed to fully fund the formula.

Read DESE’s FY2026 budget announcement →
Read DESE’s September 2026 State Board recap →

WHAT THE TAX CHANGE DID

A note on capital gains

The Department of Revenue says the individual capital-gains subtraction permits eligible taxpayers to subtract 100% of federally reported capital gains from Missouri adjusted gross income. Whether that policy produces a broader economic effect requires evidence beyond a single statewide revenue figure.

A fair conclusion: aggregate revenue totals alone cannot establish that a tax cut produced a “significant positive impact” on the economy. They also cannot isolate a single cause of a statewide revenue change. The appropriate evidence must match the specific claim.

Read the Department of Revenue’s capital-gains subtraction FAQ →

SOURCE DOCUMENTS

Read the records directly

This page relies on government documents rather than screenshots or secondhand summaries.

Missouri Office of Administration
FY2026 final general-revenue report →
FY2026 totals by department →

Missouri Lottery
Sales and proceeds history →

Missouri Department of Elementary and Secondary Education
FY2026 education budget announcement →
September 2026 State Board recap →

Missouri Department of Revenue
Capital-gains subtraction FAQ →