• 75°

Group gathers ideas about changing Miss. tax structure

A group studying Mississippi’s tax structure is getting plenty of contradictory advice from business groups, elected officials and private citizens.

Owners of small businesses said at a public meeting Monday that they want to reduce or eliminate the inventory tax. City and county leaders warned the loss of revenue from inventory taxes would force them to cut services or increase property taxes.

Advocates for the poor want to reduce the state’s 7 percent sales tax rate, particularly on groceries. A Jackson man who is tired of his property taxes increasing every few years when his home is reappraised said some sales taxes should increase — not on groceries, but on other, nonessential items.

Charles Kenny, 61, said with sales taxes, even people who don’t own property are paying for government services a few pennies at a time.

“If you can’t afford it, you won’t buy it,” said Kenny, who works as a manufacturer’s representative.

He was among three dozen people who spoke Monday to a tax study commission appointed by Gov. Haley Barbour.

The Republican governor says he wants to see a net decrease in Mississippians’ taxes before his second term ends in January 2012. Earlier this year, he appointed a 36-member commission of business people, elected officials and professors to examine the state’s tax structure.

The commission is set make recommendations by late this summer, but only legislators can approve changes.

While it’s popular for people to complain about the government digging into their pocketbooks, some said they’re willing to pay higher income taxes to improve public education and to bring balance to the overall tax structure. Among them is George Evans, who worked in a high-powered Jackson law firm for 36 years before becoming pastoral minister in 2006 at St. Richard Catholic Church.

“Our sales tax takes a greater share of income from people with lower wages than from people like me with higher wages or 401(k) savings,” Evans told the tax study group.

Evans urged the group to recommend a reduction in the 7 percent general sales tax and an increase of at least 50 cents a pack in the cigarette excise tax, which — at 18 cents a pack — is one of the lowest in the nation.

He also evoked laughter in the crowd when he said officials should consider increasing sales tax rates on “nonessentials such as beer, wine, alcohol, entertainment and athletic events, etc. — most all of which I enjoy very much.”

Kevin Aultman of the Council of Independent Tobacco Manufacturers of America, said an increase in the cigarette excise tax would hurt poor people. Aultman said state officials should consider increasing the cigarette sales tax rate so people buying more expensive brands would pay more in taxes than people buying the inexpensive brands.

Commercial developer Leland Speed is chairman of the tax study commission. He said because there has been a great deal of discussion the past few years about increasing the cigarette tax and decreasing the grocery tax, those proposals “will be given a lot of conversation.”

Speed said he not surprised to hear contradictory recommendations from the public about which taxes should increase or decrease.