Group criticizes Miss. taxes; Barbour calls for study of system

Published 7:16 pm Wednesday, September 12, 2007

JACKSON (AP) — A nonpartisan group says Mississippi has a ‘‘regressive’’ tax structure that should be revised to ease the load on personal budgets, especially as people find themselves juggling higher costs for gasoline, food and other daily expenses.

‘‘Mississippi’s tax structure places a disproportionate burden on these low-income, working families and ultimately weakens efforts to give them the tools needed to move forward in today’s economy,’’ Ed Sivak, director of the Mississippi Economic Policy Center, said during a news conference Wednesday at the Capitol.

Sivak said a study by the policy center shows:

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— The top 20 percent of earners in Mississippi, those making more than $100,000 a year, pay on average about 7 percent of their income in some sort of taxes — income tax, sales tax or other types.

— People earning about $15,000 a year pay 11.5 percent of their income in some type of taxes.

— People earning $30,000 a year in Mississippi are in the same state income-tax bracket as people earning $1 million a year.

Responding to questions later, Gov. Haley Barbour said he wants legislators, business leaders and other experts to conduct a comprehensive study that could lead to state tax cuts, possibly in a year or two.

But Barbour, a Republican who is seeking a second term in the Nov. 6 general election, said he’s not prepared to offer specifics now about which taxes he’d like to reduce.

‘‘We want an equitable, fair tax system in the bigger tax system. The federal government collects virtually no sales taxes. We collect nearly half of our general fund revenue in sales taxes. So that balances,’’ Barbour said.

His Democratic opponent in the governor’s race, attorney John Arthur Eaves Jr., said Mississippi should reduce the sales tax on groceries and increase the sales tax on cigarettes.

Mississippi has the highest state grocery tax in the nation, at 7 percent. It also has the third-lowest cigarette excise tax, at 18 cents a pack.

‘‘It is embarrassing and wrong to charge working families the highest tax rate in the country on basic food items, while I see tobacco companies preying upon our children,’’ Eaves said in a news release.

In 2006, Barbour vetoed two cigarette-grocery tax bills, calling each plan a ‘‘risky tax swap.’’ He said those pushing the plans didn’t have detailed information about how cities’ budgets would be affected by a reduction in the grocery sales tax.

Senate Finance Committee Chairman Tommy Robertson, R-Moss Point, supported the tax swap bills in 2006. He had been appointed to the chairmanship years earlier by Lt. Gov. Amy Tuck.

Tuck was elected as Democrat in 1999 and switched to the Republican Party in late 2002. She and Barbour agreed on many issues over the past four years, but Tuck was one of the leading advocates of decreasing the grocery tax and increasing the cigarette tax.

Tuck is limited to two terms and could not seek re-election this year. During the 2007 legislative session when Tuck was a lame duck, Robertson blocked cigarette-grocery tax bills that had passed the House.

Robertson was defeated in the Aug. 7 Republican primary after a national anti-tobacco group ran ads criticizing the senator for blocking the tax swap legislation this year. Barbour had helped raise campaign money for Robertson.

Eaves said Barbour vetoed the proposed cigarette tax increases ‘‘to help the tobacco companies who have paid him millions of dollars as a lobbyist.’’

Barbour, who lobbied in Washington before winning the governorship four years ago, has said repeatedly that he is against increasing any taxes.