by Emily Wagster Pettus & Michael Goldberg, Associated Press
Tax relief proposals favored by Mississippi Governor Tate Reeves and Republican legislative leaders stalled Wednesday and appear to be dead for the entire election-year legislative session, despite the GOP holding a supermajority in the House and Senate.
Even with the backing of Reeves, Lt. Gov. Delbert Hosemann, House Speaker Philip Gunn and House Ways and Means Chairman Trey Lamar — all Republicans — several proposals failed to gain enough support to even come up for a vote in either chamber.
Wednesday was the deadline for the House and Senate to take the first steps toward passing bills dealing with budgets and taxes. If money bills were not voted on before the deadline, they died.
Gunn and Lamar have pushed House members to move toward eliminating the state’s income tax rate. But a group of lawmakers is concerned about passing another income tax cut ahead of November’s legislative elections, Lamar said.
“I believe this is more of a timing issue with some of these representatives as opposed to any real opposition to income tax elimination,” Lamar told The Associated Press in a text message Wednesday. “Coming off the heels of last year’s income tax bill, and this being an election year, there are a few that would just prefer to wait a little longer before making further cuts.”
During the 2022 session, legislators enacted a plan to reduce the state income tax over four years — Mississippi’s largest tax cut ever. That reduction starts this year. Gunn, who is serving his final year in office, was instrumental in passing that bill.
Ahead of the 2023 session, the speaker came out in favor of a full elimination of the state income tax. In October, Reeves also promised to push for a full elimination.
Revenue bills require support from three-fifths of each chamber of the Legislature to pass. With all Democrats expected to oppose the measures, Republicans cannot afford to lose many votes.
Hosemann, who presides over the Senate, proposed using excess revenues to send income tax rebate checks up to $500. He has not expressed support for fully eliminating the state income tax.
Senate Finance Committee Chairman Josh Harkins, a Republican from Flowood, said Wednesday that the various tax relief proposals would not pass before the deadline.
“They are dead,” Harkins said. “I think we are focused on moving forward. We have four years to implement the tax cut we already have.”
Lamar said reviving the elements of the income tax cut bill through language in another piece of legislation is a possibility. Representative Robert Johnson of Natchez, the House Democratic leader, disagreed.
“There may be a sort of a sideways stab at it from somebody, but there is no temperament for it in the House. Not even among a majority of Republicans,” Johnson said.
Harkins said he was unaware of any bills that would keep the rebate proposal alive in the Senate.
Supporters of further cutting the income tax have said it would spur economic growth and attract new residents and companies to Mississippi. Opponents have said reducing the income tax would mean less money for schools, health care, roads and other services, especially as Mississippi grapples with the ongoing threat of hospital closures.
Mississippi’s individual income tax is the second-largest source of tax revenue, making up nearly 35% of revenue in the general fund.
“We still have a crumbling infrastructure. We’re still underfunding schools. We have hospitals about to close,” Johnson said. “Our budget just can’t sustain a tax cut when we have so many needs.”
Nine states don’t have an income tax, and one more, New Hampshire, only taxes interest and dividends, according to the National Conference of State Legislatures.