Thursday, November 3, 2016
JACKSON, Miss. (AP) — Four Democratic state senators said Wednesday they want to repeal a big tax cut passed by Mississippi lawmakers and instead use the money for roads and bridges.
Senators David Blount of Jackson, Hob Bryan of Amory, Sollie Norwood of Jackson and Angela Turner of West Point said their plan would earmark $6 billion or more for transportation over 20 years.
Earlier this year, lawmakers approved phasing out Mississippi's $260-million-a-year corporate franchise tax, cutting $145 million a year in income taxes, and lowering self-employment taxes by $10.2 million yearly. The cuts will be phased in over 12 years.
Because some House Republicans had concerns about what the tax cut would do to Mississippi's revenues, House and Senate leaders agreed to study Mississippi's tax structure before franchise tax cuts begin in 2018. That review is ongoing, influenced by advice from the conservative Tax Foundation to shift toward heavier reliance on sales and other user taxes.
Republican Lt. Gov. Tate Reeves has vowed to block any changes to the 2016 tax cuts.
"Lt. Gov. Reeves believes raising taxes on either Mississippians' income or employers' investment in the state will hamper long-term economic growth," spokeswoman Laura Hipp said.
The Mississippi Department of Transportation said it needs another $526 million a year to prevent deterioration of state highways and bridges. The amounts involved in the tax cut wouldn't reach that total, and would be smaller in early years.
"We believe this would be the most important and necessary first step toward addressing the infrastructure needs in our state," Blount said.
Bryan acknowledged that it was unlikely that majority Republicans would agree now to roll back the tax cuts. But he said the proposal starts a campaign of "moral persuasion."
"That's how you develop proposals and fight for proposals that don't have majority support right this minute," Bryan said.
The Mississippi Economic Council last year proposed raising an additional $375 million per year, without specifying funding sources. However, the state chamber of commerce says most money should come from higher fuel taxes or taxes on vehicle licenses.
"The majority of the funding, we believe, should come from the users," MEC Executive Vice President Scott Waller said Wednesday. He declined comment on the senators' proposal.
Efforts to raise fuel taxes foundered in the Legislature this year because many Republicans wanted no tax increases or didn't want to raise taxes on individuals while taxes fell for businesses.
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