In Mississippi, there has not been an easy political path to reducing sales taxes on groceries while corporate and personal income tax cuts have found easier traction.
Driving into the Neshoba County Fair gates for an inspection of what needed cleaning, washing, replacing, fixing, or receiving other attention at the Salter-Denley cabin, there was no doubt that this was a courthouse-to-statehouse election year in Mississippi.
Political signs dot the landscape from Philadelphia south to the fairgrounds. Inside the fairgrounds, political signs are already up from local beat races in Neshoba County to the marquee statewide races for governor and lieutenant governor.
Even more telling that it’s an election year is the fact that a month out from the opening of the state’s premier political stump at the fair’s Founder’s Square Pavilion, the talk is turning to grocery tax cuts proposals. This year, grocery taxes are the top-shelf issue because of Alabama’s decision to cut its grocery taxes.
Alabama lawmakers voted to reduce the state portion of their grocery taxes from 4% to 3% in September and if certain fiscal benchmarks are met in 2024, the state will cut their portion of the sales tax on food from 3% to 2%.
Where those facts get interesting is that Alabama has a combined state-local sales tax structure that produces an average 9.25% sales tax on groceries with some of the highest local sales taxes in the nation. That fact means that even with the state sales tax cut legislation there, most Alabamians will be paying more taxes for groceries than their Mississippi counterparts in the near term.
Mississippi only has very limited local sales taxes and those are optional and must be approved by voters in those local taxing districts. But just as local tax concerns impacted the long debate over grocery tax cuts in Alabama, they have historically made past grocery tax cut efforts political non-starters in Mississippi.
The state’s toughest battles over grocery sales taxes came during the administration of former Gov. Haley Barbour. Legislative efforts grew and intensified in 2006 with former Lt. Gov. Amy Tuck and the late State Sen. Alan Nunnelee, R-Tupelo, leading the charge.
But the leadership of the Mississippi Municipal League – the organization that represents the state’s city governments – was opposed on grounds that grocery sales tax cuts would trigger local property tax increases.
Those opponents predicted dire fiscal straits for municipal taxpayers should the then-highest grocery tax in the nation be taken off the backs of Mississippi taxpayers. MML members worked feverishly behind the scenes at the Capitol to get lawmakers to “protect” cities by abandoning their support of a phased elimination of the sales tax on groceries.
Raising the state’s cigarette taxes was joined at the political hip to the grocery tax cut issue as well – and helped it fail. But that fails to tell the story of why there has not been an easy political path to reducing food taxes in Mississippi while corporate and personal income tax cuts have found easier traction.
In the state’s 82 counties, 15 counties pay the majority of individual income taxes. Based on FY 2020 numbers, taxpayers in those 15 counties paid $1,161.4 billion or 64 percent of the total $1.803 billion collected statewide:
- Madison ($154.9 million)
- DeSoto ($146.3 million)
- Hinds ($138.4 million)
- Rankin ($128 million)
- Harrison ($116.6 million)
- Jackson ($88.8 million)
- Lee ($67.9 million)
- Forrest ($57.5 million)
- Lauderdale ($48.6 million)
- Lamar ($46.8 million)
- Lafayette ($45.5 million)
- Jones (34.1 million)
- Lowndes ($33.6 million)
- Warren ($27.5 million)
- Oktibbeha ($26.9 million).
Except for Oktibbeha County, those 15 counties have also represented the counties that have been the most fertile ground for statewide Republican candidates in state and federal elections. Pearl River County, a GOP stronghold, is close behind Oktibbeha County at No. 16 on the list of highest state income taxes paid, according to the Mississippi Dept. of Revenue.
Given the GOP dominance of all eight elected statewide offices and both houses of the Mississippi Legislature by super majorities, it’s clear that income tax cuts are both more in keeping with Republican fiscal policies and more attractive to them in retail politics.
Stem-winding, roof-rattling political speeches at Neshoba, Jacinto and other state political stumps aside, those facts aren’t likely to realign in the 2023 elections.