Sunday, January 12, 2025

Bill Crawford: Path for Taxpayer Relief Gets More Clouded

The math for tax cuts gets a “bit tricky,” wrote the Magnolia Tribune in an article about cutting the sales tax on groceries. “Add in another likely attempt to fully eliminate the state income tax, and the path for more taxpayer relief is clouded at best.”

The growth in state tax revenues has slowed considerably, further darkening the cloud. Revenues through November were up less than1% over the prior year, far below the growth in recent years.

Still, cuts to grocery sales taxes and the personal income tax remain priorities for state leaders. All three want to cut taxes, but Lt. Gov. Delbert Hosemann wants to be more cautious than the other two.

The personal income tax will be cut this year. Legislation passed in 2022 will continue to phase the tax down to 4% over the next two years.

Gov. Tate Reeves wants to completely eliminate it, his top legislative goal for 2025.

Speaker of the House Jason White wants to eliminate it by phasing it down over the next eight to 10 years. He also wants to cut the 7% sales tax on groceries in half and provide sustainable funding for roads and bridges, possibly by increasing the 18.4% gas tax.

Lt. Gov. Delbert Hosemann wants to continue phasing down the personal income tax over the next four years but stop at 3%. He also wants to cut the sales tax on groceries from 7% to 5%. And he thinks maintaining a minimum sales tax could help provide reliable funding for roads and bridges.

Eliminating the personal income tax is a big deal. This year the already reduced tax is projected to pull in $2.1 billion in state revenues. That compares to $2.9 billion in net sales tax revenues for the state. Sales taxes would have to increase 79% to make up for a $2.1 billion cut.

Cutting the sales tax on groceries may be more daunting. In addition to funding state government, sales taxes also serve as a major source of income for municipalities. The state diverts 18.5% of collections to municipalities.

State leaders say they want municipalities to be made whole for any cuts. That gets complicated. For some towns, sales taxes on groceries make up a large percentage of total sales taxes, not so much for others.

Speaker White said one way to make municipalities whole may be to allow them to adopt additional local sales taxes. Other legislators suggested increasing local property taxes. Adding local taxes is not an appealing solution to most communities.

Bottom line – only Hosemann seems attentive to the risks posed by declining revenue growth. It will be interesting to see if all three state leaders can reach agreement on how much to cut.

“Common sense is a fountain of life” – Proverbs 16:22.

Crawford is the author of A Republican’s Lament: Mississippi Needs Good Government Conservatives.

15 comments:

Anonymous said...

How embarassing for Tater if he has to stand with other governors before his billionaire lords and masters in D.C. and confess his state still has that socialist income tax. This should not spoil his big moment. We must spare him that shame by any means necessary!

Anonymous said...

Cutting taxes when our state has shortfalls in Medicaid coverage, mental health expansion, infrastructure improvements & many other needs is shortsighted. But it sure plays to the politicians re-election.

Anonymous said...

All hail Mammon. RINO fetishes carried out for the taxdodging .01%.

Higher taxes for the middle class.

Joined at the hips with the Oligarch Dems and sellout CEOs. Offshoring jobs or onshoring illegal alien labor. Pretending to be conservative and patriotic. LIARS.

No wonder they want to run a Mormon billionaire for Guv. Of course they do.

Anonymous said...

@10:51 The Medicaid issue is easy. Nobody under 65 qualifies for taxpayer health benefits anymore.

No more benefits for able-bodied and non-working military aged people. If you have children with disabilities and you choose to keep them, then you pay for them.

If Christians don't want to abort their deformed offspring then they better be prepared to pay the bills entirely on their own. Why should my taxes be used to pay for them?

@11:09 AM What you are describing is rootless, cosmopolitan globalism. As popularized by a people living apart in a diaspora. They care not about the citizens they exploit because they consider them nothing more than a commodity.

Anonymous said...

Oppress the middle and lower classes and chase any relief for the ruling upper class has always been Mississippi's fomula for "economic prosperity". That's our history. It's nothing new and it has never worked. All it has ever done is to perpetuate the plantation economy and turn away upwardly mobile young people. We stay the course.

Anonymous said...

10:23 as a taxpayer myself, I would say it's the people being asked to pay the taxes that are of primary concern...not anyone in DC. And I don't care if it's city, state or federal...I prefer to keep as much of the money I earn as possible. And when I see the waste and graft and giving away of free money to other countries...I would say there's plenty of room to make it work.

Anonymous said...

They are telling us that eliminating the income tax will lead to higher sales taxes and most likely higher property taxes. For all of us retired people who most likely don’t pay income taxes we are looking at a tax increase. Higher sales taxes, higher gasoline taxes, higher property taxes. It’s the bait and switch, they can campaign with the slogan of eliminating income taxes.
Folks, it takes money to provide services, so unless our elected representatives can show where they plan to cut services in the amount equal to the tax cut, then all they will be doing is swapping one tax for another.

Anonymous said...

To compensate for no income taxes, Property taxes pick up the slack in Austin, TX. So rents are sky high and property owners have to routinely hire property assessment/valuation experts to appeal sky high property taxes. Many area hiways are tollway which photo one's tag for monthly billing. MS's retired population, who no longer have income other than SS checks, will pay more sales taxes and property tax.

Don Drane said...

Raise the tax on gasoline. It's time to start taxing those who suck at the state tit and pay almost zero taxes. I assume they have to pay for their own gasoline, unlike their groceries and medical necessities.

Lowering the grocery portion of the sales tax won't affect them, since they don't pay it anyway, but it will sure as hell affect the rest of us positively.

And raise the tax on ammunition, rims and window tint.

Anonymous said...

The post at 1:16 is exactly right. And all Mr. Speakuh and the Light Gubnah are doing is whatever they think will be in their best political interest.

Anonymous said...

Not quoted here by Bill, but another major part of Speaker White's "tax cutting" is the addition of a 5% sales tax on gasoline - a significant tax on most everyone regardless of income, but proof that just like former Speaker Gunn's proposals, the House is not interested in CUTTING taxes but SWAPPING taxes. While White has hidden his attempt a little more artfully than Gunn who simply wanted to raise ALL sales taxes to 9.5% in order to reduce the state income tax. White has hidden his swap - raising sales taxes on everything but groceries, adding a tax on gasoline, suggesting local sales tax additions to cover for his grocery tax reduction.

All in all, its still a tax "swap" rather than a tax "cut",

Anonymous said...

The saying is old, very old, but still true. The only sure things in life are death, and taxes. There will be taxes, we can argue about death after we get there.

Anonymous said...

All you advocates of taxes. Californians are the most taxed people in America, and just look where they have ended up. Look to yourselves, not some government that is promising you a good life.

Anonymous said...

Same troll posting many of the comments above with the same spin as they've deposited here many times previously. Blah, blah, blah, blah.

Anonymous said...

Couldn’t agree more! @ 1:16 and 3:35, this mathing is broken!


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If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

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