Mississippi Becomes First Non-Alaska State to Begin Phasing Out Income Tax

Governor Tate Reeves signs the 'Build Up Mississippi Act,' initiating incremental tax cuts tied to budget surpluses and reducing the grocery tax.

The 'Build Up Mississippi Act' will lower the state income tax rate incrementally, starting in 2024, with a target of full elimination by the mid-2030s.
The legislation also reduces the grocery tax from 7% to 5%, providing additional relief for Mississippi residents.
Future income tax reductions are tied to state budget surpluses, leveraging Mississippi's recent strong fiscal performance.
A mathematical error in the Senate's amendment process unintentionally accelerated the timeline for tax reductions.
Critics, including some Democrats, warn of potential risks to public sector funding, while proponents argue the changes will boost Mississippi’s economic competitiveness.