Sales tax; create diversion to counties.
If enacted, HB114 stands to significantly influence the financial resources available to counties, allowing local governments to leverage sales tax revenue for essential infrastructure projects. This change is particularly relevant for counties that might have previously relied heavily on state or federal funds for road-related expenditures. By increasing the proportion of sales tax revenue that counties retain, the bill seeks to address the growing need for road maintenance and upgrades that contribute to local economic growth and safety.
House Bill 114 seeks to amend Section 27-65-75 of the Mississippi Code of 1972, proposing that eighteen and one-half percent (18.5%) of sales tax revenue collected from business activities outside of municipalities within a county be allocated directly to that county. This revenue is designated specifically for the purposes of street and road construction, repair, and maintenance. The bill aims to enhance the funding available for local road infrastructure, capitalizing on sales tax dollars that are generated in unincorporated areas.
While some legislators support HB114 for its potential to improve local infrastructure, there may be contention regarding the fiscal implications for municipalities. Concerns might arise that diverting a larger share of sales tax revenue to counties could impact funding available to cities and towns. Additionally, there may be discussions about ensuring that this new influx of funding is efficiently managed and prioritized for the most pressing needs within counties, rather than promulgating further disparities in infrastructure development compared to urban areas.