Senate Passes Massive Tax Cut

Posted 3/10/16

The full Senate has passed SB 2858, a tax cut bill that would reduce state revenue by hundreds of millions of dollars per year, phased in over 15 years. Estimates of the impact of the tax cut range from $575-million to $896-million. See your senator's vote on the tax cut bill here. Please thanks the senators who voted no on this bill. It now goes to the House.

The plan would reduce state revenue by $18-million in the first year. ​When fully implemented it would:

  • Eliminate the 3% and 4% corporate and personal income tax brackets, costing the state budget $306-million annually 

  • Eliminate the corporate franchise tax, costing the state budget $260-million annually

  • Provide for a state deduction for self-employment taxes, at a cost of $10-million annually

The totals above are based on today's dollars; with natural growth over time, the actual cost will be much higher. With the elimination of the franchise tax and the 3% and 4% corporate income tax brackets, 80% of corporations doing business in Mississippi would pay no corporate taxes at all.

Consider:

  • Mississippi ranks 13th in the nation in low business taxes (Tax Foundation) and 6th in the nation in most tax-friendly states for business (Kiplinger 2015)

  • Mississippi ranks 47th in the nation in per pupil spending on public education (U.S. Census)

  • Mississippi's public schools are under-funded this year by $201-million

  • Mississippi is under a federal court order for failing to provide adequately for the protection of children in foster care

  • Mississippi is short the additional $375-million needed to make roads and bridges safe

  • Mississippi's revenue for the current year has fallen more than $40-million short of projections, already causing mid-year budget cuts

  • Mississippi's current-year revenue was reduced by more than $124-million by corporate tax cuts passed in the last four years

  • Of the 150 largest for-profit corporations in Mississippi, 100 of them pay no state income tax

The budget bills working their way through the legislative process include cuts to nearly every state agency, including cuts to overall K-12 education funding in the amount of $7.6-million, with funding for the MAEP remaining flat (underfunded by $172-million). House appropriations bills contain reverse repealers which ensure that they will go to conference where they will be adjusted to reflect updated revenue projections, including the impact of tax cut bills that have passed both chambers.

Please ask your representative to vote NO on any tax cut bills, including SB 2858. Find contact information for all of the legislators who represent your school district.

Mississippi parents are angry with legislators who consistently choose corporate cronies over our school children. Ridgeland mom Angelique Lee expresses here the sentiment shared by thousands of Mississippi parents who want their schools fully funded.

Angelique Lee

Mississippi's children are worth our investment. Please make sure your legislators know that their excuses for under-funding schools fall flat when they vote to diminish state revenue.