For Immediate Release
Contact: Ayana Kinnel | akinnel@uniteonevoice.org
Jackson, MS, February 2, 2022 – The tax plan released by the Mississippi Senate earlier this week better balances the interests of the state’s low-income families and the wealthy, but One Voice remains concerned about the large, recurring revenue loss resulting from the tax plan. While there are more positive aspects in their plan, the permanent income tax cuts would reduce much-needed revenue for programs and services that have been severely underfunded for decades. Mississippi may be able to marginally afford the revenue loss this year, but after federal aid is depleted, the recurring tax cuts will be unsustainable and could lead to deep budget cuts.
Overall, the Senate’s plan does the following:
● Eliminates Mississippi’s 4% income tax bracket;
● Reduces the state’s grocery tax to 5% from 7%;
● Eliminates the state’s fees on car tags going to the general fund; and
● Provides a rebate of up to $1,000 in 2022 for citizens with tax liability.
The Senate plan makes some improvements on an earlier tax plan proposed by the House. The Senate’s plan does not include a full elimination of the state individual income tax, and it does not include sales tax increases that will shift the state’s tax burden further toward lower-and middle-income earners in the state. However, the Senate tax plan would do little to address the long-standing inadequacy of Mississippi’s tax code. By replacing the less progressive provisions of the bill (i.e. eliminating the 4% income tax bracket) with more bold and progressive options, we could afford to both raise revenue and make more targeted cuts for working families.
Mississippians need forward-thinking revenue policies that raise revenues for investments that keep families in their homes, workers employed, students enrolled in college, safe roads and bridges, and businesses growing. If state lawmakers move forward with the Senate’s tax plan, One Voice encourages lawmakers to consider tax reforms that raise sorely needed revenue by ensuring everyone pays their fair share, including the following:
● Taxing wealth to ensure that the state’s wealthiest individuals pay what they owe;
● Strengthening, not eliminating, the state income tax;
● Rolling back tax cuts for corporations and the wealthiest estates
● Expanding the sales tax base to include internet businesses and travel companies.
The Legislature should also not move forward without a comprehensive analysis of the fiscal impact of any tax bill, including how it would affect funding for critical services such as education, healthcare, and infrastructure. This analysis should include impacts to both state and local revenues.
One Voice will continue to advocate for a more equitable tax and budget system that will result in better communities, better opportunities, and a better state for all who live here. We look forward to reviewing the full bill and will provide a more complete analysis when available. Visit our website and follow us on Facebook, Instagram, and Twitter for additional analysis on this and other matters.
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