Submitted by Grover Norquist
Governor Reeves, Speaker Gunn promised taxpayers the Tax Freedom Act of 2022 just the first step towards complete income tax elimination in Mississippi.
The Mississippi Tax Freedom Act of 2022 is a huge win for all Mississippians.
Thanks to the leadership of Gov. Tate Reeves and House Speaker Philip Gunn, this new law will provide the largest tax cut in Mississippi history by streamlining the individual income tax to a flat rate of 4%. This provides a tax cut and a rate cut to all income taxpayers and makes the Magnolia State even more attractive to new jobs and opportunities.
Gov. Reeves and Speaker Gunn have also promised taxpayers that this is just the first step towards eliminating the state income tax completely. That means Mississippians can expect to receive even more tax relief in the coming years and rest assured that their state’s income tax structure will remain competitive in the economy of tomorrow.
There are eight states including Mississippi’s neighbor Tennessee — as well as nearby Texas and Florida — that do not impose personal income taxes of any kind. New Hampshire will be the ninth “no income tax” state as soon as it completes a five-year phase out of its 5% tax on interest and dividend income.
As 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 put their income taxes on the path to zero.
Last year, 14 states enacted legislation that will reduce their income tax burdens. This list of 14 includes Mississippi’s neighbor Louisiana, where Republicans reduced the top income tax rate – the part of the tax that is used to make decisions about investment – from 6% to 4.2%. They also included revenue triggers in the tax reform package that could eliminate Louisiana’s income tax completely, particularly if lawmakers accelerate it with additional tax cuts in the coming years.
This list of 14 includes Arkansas, where Republicans approved legislation that will reduce their top income tax rate to 4.9%, as well as North Carolina, where Republicans approved legislation that will reduce their flat income tax to 3.99%.
That momentum has carried into this year. More than a dozen states either already have or are currently working to provide permanent income tax relief. Iowa Republicans delivered the largest tax cut in state history by streamlining the income tax to a flat rate of 3.9%.
In Kentucky, Republicans overrode the Governor’s veto in order to reduce the state income tax to 4.5% as their first step towards phasing the tax out completely.
Rather than sitting back and allowing Mississippi to fall behind, Republicans worked tirelessly this year to deliver income tax relief. Under the Mississippi Tax Freedom Act of 2022, Mississippi’s bottom income tax bracket of 4% will be completely eliminated and the remaining bracket of 5% will be phased down to 4% over the next four years.
The flat income tax of 4% will also protect all income taxpayers from future tax increases.
While graduated income taxes allow politicians to divide taxpayers into groups and rob them one at a time, flat taxes require politicians to answer to all taxpayers. This makes flat taxes much harder to raise.
The Mississippi Tax Freedom Act of 2022 is a huge win for everyone in Mississippi. It will attract businesses looking to expand, and families looking for better opportunities. This growth will bring new jobs and higher wages.
It will also allow small business, which file their taxes on the personal side of the code, to invest more resources in their employees and business operations. And most importantly, it will allow individual taxpayers and families to keep more of their hard-earned money at a time when they are facing sky-high gas prices and the worst inflation in nearly four decades.
Submitted by Grover Norquist. He is president of Americans for Tax Reform.