The Mississippi House of Representatives has now approved a bill that will put the state’s personal income tax on the path to zero. Phasing out the income tax – which has been a top priority for Governor Tate Reeves – would be a huge win for all residents of the Magnolia State.
The Mississippi Tax Freedom Act of 2022, which is sponsored by House Speaker Phillip Gunn, House Speaker Pro Tempore Jason White, and House Ways & Means Committee Chairman Trey Lamar, advanced out of the state house after receiving a vote of 97-12. The bill, House Bill 531, is a great opportunity for lawmakers to deliver historic tax relief.
“Thanks to the leadership of Governor Reeves and Speaker Gunn, Mississippi has taken a giant step towards history-making tax relief this year,” said Grover Norquist, president of Americans for Tax Reform. “House Bill 531, once enacted, will make Mississippi a model for other states to copy.”
There are currently eightstates that do not impose individual income taxes of any kind: Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming.New Hampshire is slated to become the 9thno income tax state after it completes a 5-year phase out of its tax on interest and dividends income. New Hampshire does not tax wage income.
Noticing that people and jobs continue to move out of high tax states and into states that impose low- and no-income taxes, a growing movement of states are working to become the 10th no income tax state. If HB 531 is enacted this year, it is very likely that title would go to Mississippi.
“The race is on to be the tenth no income tax state,” explained Norquist. “North Dakota’s House of Representatives has already passed a phase out of the state income tax. So has the West Virginia Senate. North Carolina lawmakers have already cut the income tax in about half over the last six years enroute to zero and have voted to phase out its corporate income tax. Arizona lawmakers have already voted to reduce their state income tax to a flat 2.5% and Governor Ducey has made clear his goal is then onward to zero. The Wisconsin House and Senate plan to enact an income tax phase out this spring. Republican candidates for Governor in Iowa, Maine and Arkansas are campaigning on the goal of phasing out their state income taxes. May they all win.”
Phasing out the state income tax would be a huge win for all Mississippians. It would enable Mississippi to better compete with its no income tax neighbors Tennessee, Florida, and Texas for businesses that are looking to expand, investors who are looking for growing economies, and families who are looking for greater opportunities.
And most importantly, eliminating the state income tax would allow individual taxpayers and families to keep more of their hard-earned paychecks.
The bill now heads to the Senate. Stay tuned.