House Passes Bill to Phase Out Income Tax, Measure Heads to Senate

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By CA Staff Writer | Jan 17, 2025

JACKSON, Miss. – In a significant move to reform Mississippi’s tax system, the House of Representatives has passed House Bill 1, a measure aimed at phasing out the state’s income tax. The bill, which passed by an 88-24 vote, now heads to the Senate for further consideration.

As a revenue bill, the measure required a three-fifths majority to advance. If enacted, the legislation would gradually eliminate the state income tax and reduce the current seven-percent sales tax on groceries to approximately 2.5 percent.

Although the bill aims to provide financial relief to residents over time, an amendment proposed by Rep. Omeria Scott to immediately lower the grocery tax was tabled. This means the reduction in the grocery tax, as outlined in the bill, will follow a gradual schedule instead of taking effect right away.

The House also passed three other amendments to the bill, including language addressing wholesalers and provisions related to the “Strategic Multi-Modal Investments Fund,” which supports transportation funding.

Now that the bill has cleared the House, it will proceed to the Senate, where it will be referred to a committee for review. The outcome in the Senate will determine whether this major overhaul of the state’s tax system moves closer to becoming law.

The potential elimination of the income tax has been a topic of debate, with proponents arguing it would make Mississippi more competitive and attractive for residents and businesses, while critics raise concerns about the impact on state revenue and public services. The Senate’s decision will likely shape the future of this contentious measure.


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