Reeves says he is prepared to do whatever it takes to get the income tax eliminated.
On Thursday, Governor Tate Reeves (R) held a press conference at the Capitol in which he called upon the Mississippi Legislature to pass the elimination of the state’s income tax.
“Think back to President Trump’s time in office. Every objection to eliminating Mississippi’s income tax was thrown at Republicans trying to pass the Trump Tax Cuts. Liberals fundamentally want to spend. Conservatives want to cut taxes,” Governor Reeves said on Twitter.
Negotiations on the issue between the two chambers have hit a stalemate in recent days. The House under Speaker Philip Gunn is adamant that the full income tax be on the table while the Senate under Lt. Governor Delbert Hosemann continues to less passionate about the idea.
In an effort to make his position known after reviewing the proposals, Governor Reeves has now pitched a plan of his own, an 8-year phase out plan of the state’s income tax.
“It is time to send that money back to the taxpayers,” Reeves said. “It is time to let people keep more of the money that they’ve earned.”
Under the Governor’s income tax elimination plan, the top marginal rate would be immediately cut from 5% to 3.5%, which would be roughly $600 million, less than half of the state’s current budget surplus. Reeves also called on the legislature to reduce the marginal rate by an additional 0.5% for the next seven years to achieve the full elimination of the income tax.
The Governor said that even under his plan, there is still $600 million for those “non-conservatives who want to spend, spend, spend.”
As to the revised plan put forward by the House on Wednesday, Reeves said it was a “good faith effort” to try and compromise with the Senate but reducing $100 million a year in taxes until its gone is too little and will take way too long. Projections show under that proposal it would take 18-20 years to phase out.
Governor Reeves said he is not “married” to his plan but is committed to the elimination of the income tax.
“I am for eliminating the income tax,” Reeves said. “That will have tremendous economic power to enable individuals to invest more in themselves, invest more in their families, and potentially invest more in their businesses so that we can see a growing economy.”
Earlier this month, Governor Reeves said that while he is reluctant to call a special session, it is not off the table to address the elimination of Mississippi’s income tax.
“Well, I’m certainly not going to take anything off the table,” Governor Reeves said. “I am very reluctant to call special sessions because I think it needs to be an issue that is of significant importance to do so.”
However, Reeves said it could rise to that level.
When asked on Thursday if a special session would be an option on the table in order to pass an income tax elimination plan, Reeves said forthrightly, “I’m prepared to do whatever it takes to eliminate the income tax in Mississippi.”
The Joint Legislative Budget Committee is expected to meet on Friday and adopt revised revenue projections, increasing the total projected revenue by over $1 billion. Governor Reeves believes this truth is even more of a reason the income tax should be phased out for all Mississippians as government should not be finding new ways to spend these excess dollars, but rather give them back to taxpayers.
Conservative think tank Empower Mississippi agrees with Reeves, saying the Governor boldly seizes upon this moment in time.
“Mississippi has an extraordinary opportunity to advance transformational tax reform and the Governor’s plan boldly seizes upon this moment in time,” said Empower Mississippi President Russ Latino. “For two years we’ve debated and scrutinized the idea of eliminating the income tax. The proof is in the pudding, with states without income taxes dramatically outperforming the nation in economic and population growth. For two years, we’ve watched as revenue to government climbed while it became more expensive for Mississippi families to buy groceries. The path forward is clear and urgent. Now is the time.”