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Tennessee exempted taxes on food. Mississippi exempted taxes on guns. – Brospar Daily News

The clarion call of Governor Tate Reeves, President Philip Gunn and many other Republicans is that Mississippi should follow Tennessee and eliminate income tax.

But at least for a short time, the Tennessee legislature (boasted by Reeves and Gunn in the past for its stance on taxes) adopted tax policies often opposed by many Mississippi Republicans.

Throughout August, Tennessee lawmakers eliminated the state’s 4% food tax. Various Mississippi groups have advocated unsuccessfully to reduce or permanently eliminate the state’s 7% food tax, the highest of its kind in the nation’s poorest state.

Mississippi has its own version of the sales tax exemption. Mississippi recently experienced a so-called Second Amendment sales tax holiday enacted by the legislature in 2014, which typically eliminates a 7% tax on guns and other hunting items over the weekend.

To be clear, the Tennessee legislature eliminated the food sales tax for a month, while the Mississippi legislature eliminated the weekend gun tax.

The 7% grocery tax leaves Mississippi without vacation or respite.

Mississippi is offering a sales tax holiday for back-to-school supplies, including clothing and supplies, for a weekend in July. When it was passed in 2009, supporters said the sales tax exemption for back-to-school merchandise was an effort to provide economic relief to low-income people.

But multiple studies by liberal and conservative groups have called the so-called sales tax exemption bad tax policy. The conservative tax foundation found that the sales tax exemption “does not spur economic growth or significantly increase consumer purchases.” Various studies have shown that vacations do not help the poor as they often do not have enough money to buy more goods to take advantage of time-limited tax breaks. With limited income, they are forced to spread out their purchases over a long period.

“Lower-income consumers may be less likely to shift their shopping to the holiday season, while some, such as seniors, may have other needs than what’s on offer.” Overall, the sales tax exemption, opponents say, has just changed the timing of consumer purchases,” according to a report by the National Conference of State Legislatures.

Tennessee’s one-month tax holiday on purchases and sales of groceries is slightly different from the average sales tax holiday because it’s unusually long and offers tax breaks for items that everyone must have. Everyone must have food.

The 4% food tax exemption is part of an effort by the Tennessee Legislature to provide broad relief in 2022 to offset high inflation. Many states are taking a portion of their unprecedented surplus in many cases, offering some form of reimbursement (usually a direct cash payment) to residents below a certain income level to offset high inflation. Various states such as California, Indiana, and New Mexico are among the roughly 20 states that offer tax refunds.

Tennessee chose to do this by implementing a month-long food sales tax holiday rather than offering cash rebates.

Despite record surpluses and unprecedented taxes, the Mississippi Legislature chose not to provide short-term tax rebates or relief for calendar year 2022. The Legislature passed a record $500 million tax cut dollars, but it only started in January and would be spread over many years. For many Mississippians, they won’t get the tax cut until they file their 2022 income tax in 2023.

Years of efforts to reduce or eliminate Mississippi’s food sales tax have been unsuccessful. Several studies have shown that low-income people in Mississippi pay a higher percentage of their income in taxes than high-income people because the state has high sales taxes, especially food taxes. The poor have to spend a higher percentage of their income on a gallon of milk or a loaf of bread than the rich.

A 2021 study by One Voice and the Tax and Economic Policy Institute found that the poorest 80% in Mississippi (earning less than $77,500 a year) pay state and local taxes, compared to the bottom 20%. students.

Even before the Legislature moved to further income tax cuts in its 2022 session, Mississippi’s tax rate was low. On the other hand, Mississippi has one of the highest sales tax rates in the country and one of the highest food tax rates.

In addition to the sales tax exemption on food, Tennessee currently has a one-year sales tax exemption on the purchase of gun safes and other security items for fire arms. The Mississippi Second Amendment sales tax holiday does not include these security features.

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