Mississippi House Bill HB1720

Mississippi 2022 Regular Session

• Introduced: 2/25/22
• Refer: 2/25/22
• Failed: 4/5/22

Caption

City of Hernando; authorize a tax on restaurants to promote parks and recreation.

Impact

The bill necessitates that the Hernando city government adopt a resolution to declare its intention to levy the tax and call for an election. This election will determine the residents' approval of the tax, which requires a majority to pass. Furthermore, in order for the tax to continue beyond its initial expiration date of July 1, 2026, another election will be required. The separate accounting of tax proceeds ensures that the funds are used exclusively for the intended purpose, not treated as general revenue.

Summary

House Bill 1720 authorizes the governing authorities of Hernando, Mississippi, to levy an additional sales tax of up to two percent on the gross proceeds of restaurant sales. The intention behind this tax is to generate funds specifically for the promotion of parks and recreation in the city. Under this legislation, restaurants—defined broadly to include various types of food service operations—will be liable for collecting this tax from consumers, which must be added to the sales price of prepared food and beverages sold.

Contention

While the bill passes through legislative discussions, potential points of contention may arise regarding the imposition of additional tax burdens on local businesses. There may be concerns from restaurant owners about the impact of a new sales tax on their pricing structure and customer demand. Additionally, the requirement for repeated elections to maintain the tax could spark discussions about the efficiency and fairness of taxing local businesses for public funding of community services.