The Mississippi Senate has officially moved legislation forward that will lower the state’s income tax while simultaneously reducing the nation’s largest sales tax on groceries.
Lawmakers in the chamber voted 31-15 to send Senate Bill 3095 across the state capitol. The legislation, which received some bipartisan support, serves to phase the state’s income tax down to 2.99% by 2030 and cut the grocery tax from 7% to 5% in July 2025 with the intent of providing financial relief for Mississippians. In total, the Senate’s plan would eliminate an estimated $538 million in tax revenue from the state’s general fund, per Republican Lt. Gov. Delbert Hosemann.
But with the decreases comes a hike in another avenue. The bill includes a 9-cent addition to the existing 18.4-cent excise tax on gas, elevating the total fee to 27.4 cents per gallon by July 1, 2027. The goal is to use the funds acquired by the fuel tax increase to fund road and bridge projects statewide.
Now the bill heads to the House of Representatives, which already sent its own tax reform legislation to the Senate. House Bill 1, or the “Build Up Mississippi Act,” passed much earlier in the session as it was Republican Speaker Jason White’s top priority. The legislation would fully eliminate the state income tax by 2037 and phase down the grocery tax to 4% by 2036 and has been publicly lauded by Republican Gov. Tate Reeves.
However, the bill increases the state’s sales tax by 1.5% and ups the gas tax by 5% beginning in 2026. Just like the Senate’s proposal, the House creates a stream of recurring dollars to fund infrastructure improvements across Mississippi. One stark difference between the two pieces of legislation is that the Senate’s version stops after five years of implementation, whereas the House’s plays out over 12 years.
While a majority of senators voted in favor of the legislation, detractors pushed back ahead of the floor vote. Three chamber members took to the podium to try to alter the bill. Sen. Derrick Simmons, D-Greenville, was the first to
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