Leaders in the Mississippi House of Representatives ended the session’s opening week by filing a comprehensive tax reform package, one that would eliminate the state’s income tax in just over a decade’s time and slash tax on groceries by over a quarter in the first full year of implementation.
Purposely filed as House Bill 1, with Speaker Jason White calling it his number one priority, the “Build Up Mississippi Act” would net an estimated $1 billion tax cut for Mississippians if approved by both chambers and signed into law. As the 90-page bill is written, it would serve as the state’s largest-ever tax cut by double after the legislature approved a major reduction in income tax in 2022.
The Build Up Mississippi Act, filed Friday alongside over 450 other pieces of legislation in the House, would gradually phase out the income tax with the top rate dropping to 3% in 2027, and by 2037, there would be no “tax on work,” as many state lawmakers have referred to the levy. This would join Mississippi with nearby states such as Texas, Tennessee, and Florida as those who have ditched income tax.
Additionally, the 7% fee levied on groceries purchased in Mississippi would be reduced to 4.5% in 2026 before landing at 2.5% in 2036. Tax on groceries, which are not currently separate from the state’s 7% sales tax on retail items, is the highest in the U.S. as only 13 states tax groceries.
Reduction of income tax under HB 1 2024 4.7% 2025 4.4% 2026 4% 2027 3% 2028 2.7% 2029 2.4% 2030 2.1% 2031 1.8% 2032 1.5% 2033 1.2% 2034 0.9% 2035 0.6% 2036 0.3% 2037 0.0% Reduction of grocery tax under HB 1 July 1, 2026 – June 30, 2027 4.5% July 1, 2027 – June 30, 2028 4.3% July 1, 2028 – June 30,
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