Electronic tax

Mississippi House Takes First Step to Approve Tax Cut Plan

JACKSON, Mississippi (AP) – Mississippi would phase out its income tax, reduce sales tax on groceries, and set a higher sales tax rate on many other items, under a draft law that advanced Wednesday in the State House.

Bill 531 passed 96-12, with bipartisan support. It is similar to a bill that was passed in the House but which is dead in 2021 because the Senate leaders disagreed.

“This year’s bill is much simpler, easier to understand, and I would tell you that it is an improved product compared to the bill which was passed overwhelmingly in this body. last year, “Ways and Means Committee chairman Trey Lamar, a Republican from Senatobia, told a press conference. Debate in the House.

This year’s bill also faces an uncertain fate in the Senate. Republican Lieutenant Governor Delbert Hosemann has said he wants lawmakers to cut taxes, but has not released a proposal.

Mississippi tax recovery were higher during the first half of the current state fiscal year, July through December, than they were for the same period a year ago.

Republican House Speaker Philip Gunn has said eliminating income tax is his priority this legislative session because he believes the change will make Mississippi more competitive with states like Texas, Florida. and Tennessee, which does not tax income.

Russ Latino is president of Empower Mississippi, a group that advocates for limited government. He praised the vote in the House and said this year’s bill was better than last year’s.

“People will have more money to invest in their families, businesses and communities and Mississippi will be a more attractive place to relocate,” said Latino.

One Voice, a group that advocates policies to help low-income residents, said the House proposal “largely benefits the wealthiest in the state.”

“The state’s surplus is not enough to support much-needed investments in the public services Mississippians want, such as quality schools, affordable health care, strong infrastructure, safe neighborhoods and affordable housing “One Voice said in a press release.

The House bill would reduce the tax on groceries from 7% to 4%. The change would be phased in over six years, starting in July.

The bill would also increase several taxes from 7% to 8.5%, an increase of more than 21% of that rate. This would include general sales tax; the sales tax on alcohol; and the tax on music, games, cell phone ringtones and other products delivered electronically.

If the general sales tax were to increase by the suggested amount, for example, a person buying $ 100 of clothing would pay $ 8.50 in sales tax instead of the current $ 7. The increased tax amount would apply to purchases in person or online.

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