The commission appointed by Gov. Haley Barbour earlier this year to undertake a comprehensive study of Mississippi’s tax structure pulled its punches. Rather than championing much-needed root-and-branch reform, the commission’s draft report, issued on Aug. 15, recommended a few tweaks to a tax code that long has placed the state at a competitive disadvantage in attracting new businesses, creating jobs and spurring economic growth.
This first in a series of five columns evaluates the assumptions made and methods used by the Tax Study Commission in formulating its preliminary policy proposals. Wednesday, Thursday, Friday and Sunday columns will address the most important of the commission’s recommended tax reforms, including those affecting state and local sales taxation, tobacco taxes, taxes on Internet and mail-order purchases and personal and corporate income taxes.
In fairness, the governor’s charge to the commission hamstrung it from the outset on two critical aspects of its work. First, whatever reforms it put forward were to be “revenue-neutral.” A proposed increase in any one state tax had to be offset by cuts in others, so that at the end of the day total tax collections remained unchanged. The requirement of revenue-neutrality precluded the commissioners from considering the bold, across-the-board reductions in taxes that truly would brighten Mississippi’s economic future.