"They modeled this bill over what Kansas did, and Kansas was just dramatically downgraded," Governor Jay Nixon said.
The bill has caused tension along party lines. Republicans are for the tax cut, while democrats are against it.
Caught in the middle are school districts in the state.
"Anytime the state budget is cut, education will take an effect," said John Schlange, a board member with the Missouri State Teacher's Association.
Schlange is also an educator in the St. Joseph School District. He said if this cut takes full effect in a few years, it could cost the St. Joseph School District millions.
"Currently under the proposal that we understand we will be losing about $3.6 million to the St. Joseph School District," he said.
Schlange said losing that amount of money could cause serious problems.
"We are about a $117 million budget, 80 percent is staff," he said. "We would have to look at staff, we would have to look at everything we do as a school district."
In years past when the district has not met budget goals, they have deferred maintenance or frozen teacher salaries.
St. Joseph isn't the only district worried. The Savannah School District is expecting a big loss too - almost $689,000.
The budget cuts would only go into affect if certain revenue goals are met in the state.
"If the state revenues continue to grow and taxes are decreased there will still be the same amount of money," Schlange said. "If revenues don't continue to grow there will be less money, education is a large portion of the budget."
Nixon warns that this type of cut is a risky experiment. But republicans say it's a monumental moment for the state and it would not affect state services.
"It's the first tax reform, tax relief measure that this state has seen in nearly 100 years," said Rep. Timothy Jones, the Republican Speaker of the House.
Here is a list of how the bill could affect all districts in the state.
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