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“I’m opposed to robbing Peter to pay Paul. In fact, I want Peter and Paul to have more money in their pocket.” —Governor Tate Reeves on the new tax proposal.
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Tax Relief, But For Whom?
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Speaker Gunn Wants Reform That Benefits Wealthiest, Costs Others More
September 1 - 28, 2021 • jfp.ms
Mississippi House of Representatives Speaker Philip Gunn introduced legislation to eliminate Mississippi’s personal income tax earlier this year, while proposing to make up for the revenue shortfall with increased consumption taxes, such as sales tax, adding up to regressive reforms that have drawn criticism from businesses and advocacy groups alike.
doing so best positions Mississippi for longterm success,” Reeves said. “I hope that once the hearings are over, the Legislature will realize that eliminating Mississippi’s income tax is needed and reducing the tax burden on Mississippians across the board is the best way to ensure our state’s economic prosperity.” Reeves stopped short of approval for Gunn’s proposed sales-tax increase, however. “I hope that once the hearings are over, the Legislature will realize that the best way forward is to not swap the income tax for increases in sales, taxes, agriculture FEMA
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Varying Support of State Leaders During the hearings, Gov. Tate Reeves expressed his approval for doing away with the state income tax in an Aug. 24 press briefing after thanking Sen. Josh Harkins, R-Flowood, and Rep. Trey Lamar, R-Senatobia, for organizing the hearings. “I’m also very glad that the lieutenant governor, speaker, and I all agree that the income tax should be eliminated, and that
COURTESY PHILIP GUNN
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ust as the realities of a fourth wave of COVID-19 sunk into the state, and just miles from a field hospital set up in the garage of the Mississippi hospital most likely to serve low-income patients, Mississippi legislators held a hearing on eliminating the state income tax. The tax elimination is a pet project of House Speaker Philip Gunn, who introduced legislation to reform Mississippi’s tax structure in the last legislative session. The bill passed in the House but died in the Senate, where support for the proposal never materialized. The proposal quickly drew nearuniversal criticism from myriad sources who don’t always agree over its potential negative effects on Mississippians with lower incomes, including vulnerable population advocacy groups, Mississippi businesses and organizations such as the Mississippi Chamber of Commerce. The late-August joint Senate-House panel held two hearings, with testimony from economists, tax experts and advocacy groups about potential risks and benefits of the tax-reform proposal that would replace lost income-tax revenue with an increase in sales tax and other consumption taxes. Gunn’s proposal would mean that Mississippians would save an increasing amount of money as their income level rose, which means the more money someone makes, the more they would benefit from the proposed cut. “It puts money back into your pocket,” Gunn said in a Feb. 25, 2021, video explaining his proposal. To make up for the loss in revenue, Gunn’s proposal would raise the already regressive state sales tax from 7% to 9.5%, in addition to certain other taxes like the state use tax.
by Julian Mills
taxes and other taxes,” Reeves said. “If you agree with me on that, that we should eliminate the income tax without raising taxes in other areas, I recommend you mention that to your legislators.” “I’ve said it before, and I’ll say it again,” the governor said. “I’m opposed to taking less from you here and taking more from you there. I’m opposed to robbing from Peter to pay Paul. I’ve been in contact with many small businesses across Mississippi, including in the manufacturing and agricultural space, with outside think tanks and many other
stakeholders. Based on my conversations with them it’s clear. The consensus is that eliminating, not swapping the tax burden, is the way to go.” Lt. Gov. Delbert Hosemann agreed in part earlier this year. “I have concerns about raising anybody’s taxes,” Hosemann said on March 1. “There are significant things to discuss here.” ‘The Cooler Is Not a Grocery’ At the hearings, Mississippi Department of Revenue Commissioner
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