As expected, the top priority in Gov. Tate Reeve’s proposed budget for FY 2024 was elimination of the state income tax. The Governor noted that “Mississippi now has the 5th lowest marginal tax rate in the entire nation,” but apparently that is not good enough. “Mississippi must take further steps to remain competitive and to attract new investments to the state,” he said.
His proposal calls for the 4% tax bracket currently being phased out to be eliminated all at once, then the final 5% bracket eliminated 1% a year until it is gone.
“Mississippi can afford to eliminate its income tax” and will not have to cut budgets to do so, Reeves contends. For FY 2022 the personal income tax generated a little less than the state sales tax for the general fund, about $2.2 billion compared to $2.5 billion. These two sources provide about 70% of general fund revenues.
Hmmm.
That probably means sales tax collections would need to more than double over the next five years to makeup the difference. Sales taxes did jump about $309 million from FY2021, spurred by federal recovery dollars. But over the previous five years collections were up $88 million, $18 million, $56 million, $27 million, and down $7 million. It will take some magic to make up $2.2 billion a year in five years.
A review of other items in the Governor’s budget shows he either doesn’t pay much attention to the details or he doesn’t appreciate the impact inflation will have. Over 90% of the line items for FY 2024 are listed at the exact same amounts as the Legislature’s final budget for FY 2023. A big one left flat was for the Mississippi Adequate Education Act, i.e., school funding. With inflation running at 8%, expecting schools and agencies to operate for the same amount will amount to a noticeable cut.
Just as he protected children from non-existent critical race theory teaching in schools this year, the Governor now wants to protect children from “new controversial, experimental social science experiments” he said are popping up in other states (but not Mississippi). His Mississippi Parents’ Bill of Rights would prevent that. Of course the bill outlawing critical race theory didn’t really. Wonder what this bill would really do.
The Governor proposed a child care tax credit, so long as the income tax remains. Apparently a permanent program is not needed.
“We will build a future that every Mississippian can be proud of,” the Governor proclaimed in his press release. That’s a pretty stout claim given the United Way’s ALICE project (Asset Limited, Income Constrained, and Employed) estimated in 2021 that 50% of Mississippi households were left out or left behind – 19 percent living below the poverty line plus another 31 percent too poor to afford the basics of housing, child care, food, transportation, health care, and technology due to low wages.
The Legislature’s budget proposal comes out soon. It likely will be quite different.
“Good men will be generous to others” – Isaiah 32:6.
Crawford is a syndicated columnist from Jackson.
26 comments:
“Good men will be generous to others” – Isaiah 32:6
Crawford thinks this means to pay for others way.
Sorry Bill, your communism isn’t anything I want to be a part of.
JJ offers far more diversity of opinion columns than does the Barksdalers or LaddCo.
My understanding is that the states without income tax also have very high property taxes. I hope this proposal to eliminate the state income tax goes nowhere, especially if it means sharp increases to property taxes.
11:15 AM, you must be special!
KF usually censors any criticism of his fellow propagandist Bill (won’t say his last name so maybe KF will let this one through).
They like to quote scripture and post sermons but couldn’t care less about the innocent children in Jackson that died from stray bullets and the poor people subjected to the out of control leftist Democrat caused crime.
Using religion to promote evil? Blasphemy!
"Nah."
Why not, education for the masses is not a priority in Mississippi anyway and for those people who require quality education for their children, there is always private school. That's one area Tater knows WE can afford to cut.
The cost of government is fixed, and it is funded by income tax, sales tax, property tax, etc. If the income tax burden is reduced, then one or more of the other categories needs to be adjusted to make up for the lost revenue.
This is political smoke and mirrors.
Sadly, Mississippi has so many more issues that are a deterrent to businesses and people moving here, that lowering/eliminating the state income tax, which is already very low, will have little if any impact.
Those "other issues" being crime, roads, bridges, corruption, minimal skilled labor, weather...
@12:04pm
In TX, property taxes are high and based on full market value. One must engage an independent appraiser and make an appeal to challenge the tax man.
There may be ways to live in the middle of an agricultural use to avoid/limit aggressive property taxes in TX. In TX, that may be a cattle ranch. In MS, that may be an inbred hippie family living in a VW bus on a pot farm?
We’ve been avoiding raising the gas tax for 30 years, PERS is underfunded by a billion dollars, so sure governor, let’s reduce the revenue so we can file for bankruptcy to avoid paying our bills. Kindergarten students have a better grasp of finance and budgets than our governor.
Reducing/eliminating income tax would put a burden on those retirees who are exempt because the legislature would have to increase other taxes which those retirees would have to pay.
It's political smoke and mirrors. Tater Tott wants to hand us $5 with one hand while he is pickpocketing $20 with his other hand.
@4:44 PM - Now just wait a minute... Tater has a degree in economics and is a Chartered Financial Analyst. (No mention of his grades and his class ranking).
This is a political stunt. He knows that there is no way this can pass the legislature, this is his attempt to eliminate his competition in the next election. He is pro tax cut and any member of the legislature he can label as pro tax. If this tax cut did pass it would only put this state further behind the rest of the nation.
The state provides services, those services cost money to provide which is derived from taxes. Cut taxes=cut services. So governor, explain what services you plan to cut or what other fees/taxes you propose raising in order to balance the budget.
If Crawford is either unaware of or in denial about CRT emerging across this country, that's a prime example of full-blown ignorance on public display.
Not knowing Crawford, I can't say he's a communist, but judging from his columns, I'm inclined to think so.
Crawford, as usual, leaves reason at the door and tries to pull this fast one: “ A review of other items in the Governor’s budget shows he either doesn’t pay much attention to the details or he doesn’t appreciate the impact inflation will have.” That Crawford can only imagine those two possibilities offers real insight into his view of government waste and spending. There is another option: That Tate does appreciate the impact inflation will have and is using this opportunity to advocate for less real government spending. Government has too many things it tries to do, spends more than it should trying to accomplish those things, and has too many agencies and personnel trying to dream up new missions and reasons for their existence and expansion. Perhaps that’s what Tate thinks — something unimaginable to Crawford, evidently.
Everyone that lives and passes through Mississippi pays sales tax if they buy anything from a business. This includes dope boys, illegals, swindlers, and the rest. So, I'd like this idea of raising the sales tax and get rid of the income tax.
November 20, 2022 at 3:00 PM I left out medical care. The availability of care here sucks, and that isn't just in rural areas, but also in the Metro area. Those UMMC medical school graduates must head to Texas or Florida or (gasp), California.
@12:04
A TN resident 1997-2016. MS resident again 2017 to present. I didn't live in a big TN city like Nashville but I've found MS to be more expensive in every category compared to middle TN. MS also has more regulations on everything from notaries to real estate. I was amazed at the paperwork and expenses when we sold and bought another home here. TN makes up for it's lack of income tax by promoting and getting big business plus a state sales tax of 7%, 5% on food. Local taxes may run it up to 9.75% total. According to my tax returns I was still saving money in TN. I also noticed TN appears to know how pick up after themselves, less trash on roads. If it wasn't for family I'd still be there or maybe FL.
The problem is that Tate envisions MS to be a carbon copy of FL or TX, those states have economies. MS cannot compete with AL or LA in shipping, because our ports are too shallow. At best TN has the blueprint, however I don't see this state surpassing AR.
Since I'm an accelerationist, I say do it but not for the popular reasons.
Crawford, like all democrats has never supported a tax cut, but is all in on a tax increase.
All of the above commenters miss that no income tax invites more business investment, more jobs, more prosperity. A larger property tax would get a proportionate contribution from all. Even renters would pay extra rent so their Landlords could pay the property tax on the rental property. Governor Reeves is to be commended for his proposal.
If we had zero income tax, you still couldn't get economic investment here.
We already give a pass on property tax.
Until you.
But, none of you will ever face what keeps others away...it's the prejudices you don't acknowledge or abandon...against everyone from ivy league educated people to minorities and women.
Corporate America hires based on education and intelligence and so they have those you love to hate as vital employees in management and training positions.
This book I'm writing is sooooo good mannnn. I need a title.
11:05 How about this: Greater commitment to education invites more business investment, more jobs, more prosperity. Governor Reeves is to be chided for his lack of foresight.
Cranford is just a troll.
"Corporate America hires based on education and intelligence'
Oh really? And who the hell told you that? Corporate America, more often than not, hires based on race, sex, disability and the appearance of wokeness and diversity.
Secondary to that fact (if considered at all) is that thing comprised of experience, credentialing, record of accomplishment, exhibited propensity to achieve team fit, what he or she brings to the table, how he or she might contribute to profitability and company objectives and a demonstrated ability to adapt to company culture.
8:12 You must be unable to find a job. Corporate America hires to make a profit. If you can't make money for them they don't need you. Sorry you got hurt.
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