The Mississippi House of Representatives had one item on Thursday’s calendar – a bill to eventually eliminate the state’s income tax and slash its grocery tax – and after over an hour of debate, enough lawmakers came together to easily approve the package and send it to the Senate.
Intentionally filed as House Bill 1, the “Build Up Mississippi Act” passed on an 88-24 vote as some Democrats in the GOP-controlled chamber stepped across the aisle to ensure the bill had enough support. The legislation would net an estimated $1 billion tax cut by phasing out the income tax in just over a decade and significantly cutting the nation’s highest tax on groceries over a slightly shorter time span.
“This is a bill that has been a long time coming,” House Ways and Means Committee Chairman Trey Lamar said, noting his work on eliminating the income tax began in 2016. “We’re finally at a place where we can tell the hardworking people of Mississippi that we’re going to eliminate the income tax for you, your children, your grandchildren, and all future generations. It’s an honor to present this bill to the body.”
As Lamar fielded questions over whether the package would sink the state’s budget and why lawmakers should cut taxes when public universities and community colleges are still in need of further funding, the Republican from Senatobia stood strong in his belief that state revenue would not go backward. He added that a plan is set in place if the tax cut were to result in a budget shortfall, as seen in Kansas when lawmakers decided to eliminate income tax there and were forced to backtrack on their decision.
“We’ve got a rainy-day fund currently of around $700 million,” Lamar said. “We also added the new budget stabilization fund with $200 million that can only be accessed if needed.”
The Build Up Mississippi Act would maintain a major reduction in income tax that was passed by the legislature and signed by Republican Gov. Tate Reeves three years ago before dropping the top rate to
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