JACKSON, Miss. (WTVA) — Mississippi’s governor signed a bill into law that will eventually eliminate the state income tax.
Gov. Tate Reeves signed House Bill 1 into law on Thursday afternoon, March 27.
The law cuts the individual income tax from 4.70% to 3% by 2030.
It will eventually go away entirely if there’s enough economic growth and government spending is kept under control.
The bill also decreases the grocery sales tax from 7% to 5%, effective July 1.
The bill also increases the gas tax from 18 cents a gallon to 21 cents and up 3 cents a year until it stops at 27 cents in 2027. It could then increase 1 cent every other year.
In March 2026, the state retirement system will change for new government employees, meaning no more fully-funded retirement by the state. It’ll be a split between the state and something similar to a 401(k).
This has some government employees, such as law enforcement officers, worried about future recruitment. The Mississippi Association of Chiefs of Police denounced the decision.
“We have ask legislators and the Governor to reconsider their positions on this language because if passed and put into law it will be the same as signing a ‘death warrant’ for many future first responders trying to work for 35 years just to receive a benefit they will not able to survive on to begin with.”
Open this link to read the full response.
Mississippi's governor signed a bill into law that will change the way state retirement is handled for government employees, such as law enforcement officers.
The Mississippi Senate originally wanted a much slower march toward eliminating the state income tax.
However, the Senate inadvertently sent a typo-riddled bill to the House that speeds up the elimination process.
Representatives passed the typo-riddled bill and Reeves agreed to sign it. However, lawmakers could go back and adjust the timeline to eliminate the income tax.
