Mississippi Senate Bill SB2211

Mississippi 2022 Regular Session

• Introduced: 1/13/22
• Refer: 1/13/22
• Failed: 2/23/22

Caption

Tax Payer Pay Raise Act; remove phase out of income & franchise tax & remove deduction of federal employment tax.

Impact

In its revisions, the bill also addresses the corporate franchise tax, abolishing the provisions that phased out this tax beginning January 1, 2019, and ultimately repealing the franchise tax law set to take effect January 1, 2028. By removing these tax phase-outs, SB2211 aims to simplify the tax obligations for businesses in Mississippi, potentially encouraging economic growth through favorable taxation conditions. The removal of specific tax liabilities is believed to promote state investment by both local enterprises and outside businesses looking to establish themselves in Mississippi.

Summary

Senate Bill 2211, known as the Tax Payer Pay Raise Act, seeks to amend several provisions of the Mississippi Code related to income and franchise taxes. Notably, the bill removes the phased-out income tax on the first $5,000 of taxable income that was scheduled to take effect starting January 1, 2019. Additionally, it proposes the elimination of a provision which allowed a portion of federal self-employment taxes as an adjustment to gross income under state income tax law. These changes aim to maintain a tax-free threshold for lower income and self-employed individuals.

Contention

Opposition to the bill may arise from concerns about its long-term fiscal implications, particularly how continuing to exempt lower income and corporate profits from taxation could affect state revenue. Critics may argue that such measures could lead to insufficient funding for public services, especially in sectors like education and healthcare, which are crucial for community welfare. Additionally, the removal of the self-employment tax adjustment may disadvantage self-employed persons who depend on such deductions to manage their taxable income effectively.