Rumors of special session loom over 2025 tax cut debate
MS Senate announces tax plan with cuts to grocery, income taxes
Lt. Gov. Delbert Hosemann announces the Senate’s tax plan at the Mississippi State Capitol in Jackson, Miss., on Wednesday, Feb. 12, 2025.
- The Mississippi Senate passed a $326 million tax cut bill that would reduce income and grocery taxes while increasing the gas tax.
- The bill passed largely along party lines, with some Republicans joining Democrats in opposition due to the gas tax increase.
- Governor Tate Reeves prefers the House’s plan to eliminate the income tax entirely and may call a special session if a compromise isn’t reached.
The Mississippi Senate passed a net $326 million tax cut Monday, teeing up a debate with the House that could potentially cut the state income tax, reduce the grocery sales tax and raise the tax rate on gasoline.
After more than an hour of debate, the Senate passed Senate Bill 3095 mostly by party lines. Despite the idea of a tax cut being a sticking point for GOP leadership this year, some Republicans voted against the bill, noting that it did not lower taxes on Mississippians but raised them on the gas tax.
The bill passed 34-15, with four Republicans voting with the Democratic caucus while at least four Democrats voted to support the tax cut. Two Senate members were counted as absent.
“I’m just trying to follow my party’s platform,” said Sen. Angela Hill, R-Picayune.
Sen. Josh Harkins, R-Flowood, told reporters after the vote that the Senate’s position on tax cuts this year focuses on responsibly reducing the tax burden of Mississippians at the grocery store while ensuring equitable funding for key infrastructure such as highways and bridges via a gas tax increase.
If passed by the full Legislature, SB 3095 would reduce the personal income tax to 2.99% by 2030 and cut the grocery tax in half. It would also raise the gas tax by 9-cents per gallon.
“It speaks to the careful attention that we gave to the plan, and I think we have put forward a really good plan that helps families at the grocery store by lowering the sales tax on groceries,” Harkins told reporters after the vote. “It provides relief and incentive and rewards work. It also provides for revenue for critical infrastructure maintenance across our state, and it’s going to provide money to MDOT and to our counties across the state to maintain the infrastructure system that we spent decades and decades building.”
Lt. Gov. Delbert Hosemann in a press release issued after the measure passed, saying SB 3095 is a win for Mississippi.
“Mississippi families, workers, and retirees need immediate tax relief, and we are one step closer to making that a reality,” Hosemann said. “With the Senate’s advancement of Senate Bill 3095, we are moving forward with the next phase of historic reform. Our priorities are clear — lowering grocery costs, rewarding hard work instead of taxing it, and ensuring strong, consistent infrastructure funding. This plan is consistent, conservative, and financially responsible, ensuring we provide relief while maintaining a stable economic foundation for the future.”
Republican Gov. Tate Reeves has already thrown cold water on the Senate plan, which he sees as not going far enough. Reeves has also touted support for the House plan, which unlike the Senate’s, seeks to totally eliminate the personal income tax.
When asked what areas of the Senate plan could be up for a compromise, he said he still needs to speak with House leadership, but that he stands firm in the Senate’s approach to responsibly phasing down the income tax, which accounts for one-third of the state general fund budget.
Rumors are circulating that a special session, ordered by Reeves, would be incoming if the Senate doesn’t come to the House’s table on totally cutting the income tax. Harkins said that would not change his position.
“I can’t guess what he may or may not do,” Harkins said.
The bill faced some measure of opposition from Senate Democrats on the floor Monday, most notably from Sen. Hob Bryan, D-Amory, who offered amendments to change the nature of the tax cut. Bryan said the bill would do nothing but put the state in a vulnerable position in terms of paying for key government services. His amendments failed.
Senate Minority Leader Derrick Simmons, D-Greenville, and David Blount, D-Jackson, both offered amendments as well to change the nature of the bill, but they also failed.
The bill now moves onto the House for further consideration.
Grant McLaughlin covers the Legislature and state government for the Clarion Ledger. He can be reached at [email protected] or 972-571-2335.
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