Mississippi Tax collections up for the year

Jackson, Miss – Revenues continue to adjust to new fiscal realities in Mississippi as the state phases in the largest tax cut in Magnolia State history.

The Legislative Budget Office released the May state revenue report last Wednesday showing Mississippi tax collections are up $134.8 million for the year with one month remaining in the fiscal year. A new fiscal year begins on July 1st.

However, the month of May came in $51 million below the sine die revenue estimate, a number that could without context give onlookers pause.

The Legislature passed and Governor Tate Reeves (R) signed into law a $525 million tax cut plan in 2022 which eliminated the 4% income tax bracket and phased down the 5% bracket to 4% over a three-year period. Most of the May decline is a result of reduced individual income tax collections from that tax cut.

General Fund collections for May this fiscal year were $42.7 million less than the previous fiscal year’s May numbers, with individual income tax collections down $24.5 million and corporate income tax collections down $12.9 million year-over-year for the same month.

With one month remaining in the fiscal year, individual income tax collections are down $155.7 million over the prior year as Mississippians are keeping more of their earned income.

Sales tax revenue continues to be a bright spot, with collections for the month of
May above the prior year by $6.5 million and up year-over-year by more than $78 million.

Overall fiscal year-to-date collections for eleven months into the current year are down $17.9 million over the prior year.