Mississippi Gov. Tate Reeves prefers eliminating income tax over grocery tax

Mississippi Republican Gov. Tate Reeves said in June that he would rather eliminate his state’s income tax than its grocery tax, a regressive tax that disproportionately impacts low-income residents.

Reeves has vocally supported cuts to the state’s income tax for years, but he hasn’t taken an official stance on the grocery tax. 

During a June 11 interview with WLOX, an affiliate of ABC and CBS in Mississippi, Reeves celebrated past efforts to reduce the state’s income tax, but repeatedly avoided taking an official stance on the state’s high grocery tax: “When it comes to eliminating the sales tax on groceries, I’ve said many times in the past, I don’t know that I’ve ever seen a tax cut that I wouldn’t support. I do think it makes more sense economically and will help us grow our economy to eliminate the income tax because I believe that if you want more of something, you should tax it less.”

After host Dave Elliot followed up by asking if he supports efforts to reduce the grocery tax, Reeves did not answer the question, saying, “I am open to cutting taxes of any sort.”

Mississippi’s 7% grocery tax is the highest such tax in the country, even though the state is one of the poorest in America. Because the tax is regressive, it forces low income taxpayers to carry a disproportionate share of the tax burden.

Mississippi is one of just three states in the country that tax groceries at the full state sales tax rate, according to the Center on Budget and Policy Priorities. The other two, Alabama and South Dakota, have much lower sales tax rates at 4% and 4.5%, respectively.

“Sales taxes on groceries have an especially harmful impact on income and racial inequities since low-income families tend to spend a larger share of their income on groceries,” the Center on Budget and Policy Priorities, which urges lawmakers to eliminate the grocery tax, wrote in a 2020 report. “State policymakers looking to make their tax codes more equitable should consider eliminating the sales taxes families pay on groceries if they haven’t already done so, or at least reducing these taxes or partially offsetting them through a tax credit.”

In 2021, the most recent year for which data was compiled, Mississippi had the second-highest poverty rate in the United States. Some 19.4% of the state’s population was living below the federal poverty line that year according to Census Bureau data compiled by the Center for American Progress. Only Louisiana, where 19.6% of the population was living below the poverty line, had a higher rate.

The Mississippi Legislature has debated eliminating or reducing the grocery tax in the past. However, bills that would have eliminated it died in committee this year.

Reeves never took an official stance on the bills, but he has vocally supported efforts to cut the income tax. In October 2022, he said he’d push the Legislature to completely eliminate the state income tax during the 2023 legislative session.

“The No. 1 example of what I want to continue working on in the second term is the complete elimination of the income tax in our state,” Reeves said in January when he announced he was running for a second term, according to Fox News. “In 2016, we passed the largest tax cut in Mississippi history. Last year, I signed into law an even bigger tax cut for the people of Mississippi. We’ve reduced our income tax. There are 41 states across America that have a personal income tax. Today, Mississippi has the fifth-lowest. I want Mississippi to join those nine states that have no income tax, and we have a path to do so.”

Eliminating the state income tax, however, benefits the wealthiest residents of the state the most, according to the Tax Policy Center.

“In all 11 states that cut individual income tax rates in 2022, the largest direct benefits went to the highest earning households. That’s because the benefits of a tax rate cut are relative to a household’s tax bill,” Richard C. Auxier, a policy associate at the Tax Policy Center, wrote in February. 

What’s more, a report from the Institute on Taxation and Economic Policy said that cutting income taxes leads to a loss of revenue that “can jeopardize a state’s ability to fund vital public services that any low- or middle-income household needs to thrive like K-12 schools, community colleges, public health services, broadband access, etc.”

A poll of registered voters in Mississippi taken in January by Mississippi Today/Siena College shows that more respondents favor eliminating the grocery tax than eliminating the state income tax: It found 68% of respondents want to suspend the grocery tax, while 55% support ending the state income tax.

Reeves is running for reelection in Mississippi this November against Democrat Brandon Presley, a member of the Mississippi Public Service Commission who is running unopposed for the Democratic nomination.

Presley supports eliminating the grocery tax and criticized Reeves for not campaigning to get rid of it.

“If he would support it, why has he not opened his mouth about it for 12 years?” Presley said at a campaign event on Thursday, according to the Clarion Ledger. 

Presley added, “Have you been that busy at fundraisers that you didn’t know that people want the grocery tax eliminated?”

Mississippi Today/Siena College polling of registered voters conducted in April showed Reeves is unpopular, with 60% of voters saying they want “someone else” to serve as governor.

It also found Reeves with a 49%-38% lead over Presley in the heavily Republican state.

Published with permission of The American Independent Foundation.