MISSISSIPPI LEGISLATURE
2004 Regular Session
To: Ways and Means
By: Representative Mayo
AN ACT TO AMEND SECTIONS 27-7-5, 27-69-13, 27-69-75, 27-71-307, 27-71-337, 27-71-11, 27-71-29, 75-76-177 AND 75-76-129, MISSISSIPPI CODE OF 1972, TO INCREASE THE STATE INCOME TAX; TO INCREASE THE EXCISE TAX ON CIGARETTES; TO INCREASE THE EXCISE TAX ON LIGHT WINE AND BEER; TO INCREASE THE MARKUP ON ALCOHOLIC BEVERAGES; TO INCREASE THE GAMING LICENSE GROSS REVENUE FEE; TO PROVIDE THAT THE REVENUE DERIVED FROM THE TAX INCREASE AUTHORIZED BY THIS ACT SHALL BE DEPOSITED INTO THE BUDGET CONTINGENCY FUND; TO PROVIDE THE PURPOSES FOR WHICH SUCH MONIES DEPOSITED INTO THE BUDGET CONTINGENCY FUND SHALL BE EXPENDED; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-7-5, Mississippi Code of 1972, is amended as follows:
27-7-5. (1) (a) Except as otherwise provided in this subsection (1), there is hereby assessed and levied, to be collected and paid as hereinafter provided, for the calendar year 1983 and fiscal years ending during the calendar year 1983 and all taxable years thereafter, upon the entire net income of every resident individual, corporation, association, trust or estate, in excess of the credits provided, a tax at the following rates:
On the first Five Thousand Dollars ($5,000.00) of taxable income, or any part thereof, at the rate of three percent (3%);
On the next Five Thousand Dollars ($5,000.00) of taxable income, or any part thereof, at the rate of four percent (4%); and
On all taxable income in excess of Ten Thousand Dollars ($10,000.00), at the rate of five percent (5%).
(b) For calendar year 2004, and each calendar year thereafter, there is hereby assessed and levied, to be collected and paid as hereinafter provided, upon the entire net income of every resident individual, association, trust or estate, in excess of the credits provided, a tax at the following rates:
On the first Five Thousand Dollars ($5,000.00) of taxable income, or any part thereof, at the rate of three percent (3%);
On the next Five Thousand Dollars ($5,000.00) of taxable income, or any part thereof, at the rate of four percent (4%);
On the next Five Thousand Dollars ($5,000.00) of taxable income, or any part thereof, at the rate of five percent (5%); and
On all taxable income in excess of Fifteen Thousand Dollars ($15,000.00), at the rate of six percent (6%).
(2) An S corporation, as defined in Section 27-8-3(1)(g), shall not be subject to the income tax imposed under this section.
(3) A like tax is hereby imposed to be assessed, colleted and paid annually, except as hereinafter provided, at the rate specified in this section and as hereinafter provided, upon and with respect to the entire net income, from all property owned or sold, and from every business, trade or occupation carried on in this state by individuals, corporations, partnerships, trusts or estates, not residents of the State of Mississippi.
(4) Except as provided in subsection (5) of this section, in the case of taxpayers having a fiscal year beginning in the calendar year 1982 and ending after the first day of January 1983, the tax due for that taxable year shall be determined by:
(a) Computing for the full fiscal year the amount of tax that would be due under the rates in effect for the calendar year 1982; and
(b) Computing for the full fiscal year the amount of tax that would be due under the rates in effect for the calendar year 1983; and
(c) Applying to the tax computed under paragraph (a) the ratio which the number of months falling within the earlier calendar year bears to the total number of months in the fiscal year; and
(d) Applying to the tax computed under paragraph (b) the ratio which the number of months falling within the later calendar year bears to the total number of months within the fiscal year; and
(e) Adding to the tax determined under paragraph (c) the tax determined under paragraph (d) the sum of which shall be the amount of tax due for the fiscal year.
(5) In the case of a resident individual, association, trust or estate having a fiscal year beginning in the calendar year 2003 and ending after the first day of January 2004, the tax due for that taxable year shall be determined by:
(a) Computing for the full fiscal year the amount of tax that would be due under the rates in effect for the calendar year 2003;
(b) Computing for the full fiscal year the amount of tax that would be due under the rates in effect for the calendar year 2004;
(c) Applying to the tax computed under paragraph (a) the ratio which the number of months falling within the earlier calendar year bears to the total number of months in the fiscal year;
(d) Applying to the tax computed under paragraph (b) the ratio which the number of months falling within the later calendar year bears to the total number of months within the fiscal year; and
(e) Adding to the tax determined under paragraph (c) the tax determined under paragraph (d) the sum of which shall be the amount of tax due for the fiscal year.
(6) The revenue derived from the additional tax rate of one percent (1%) imposed under House Bill No. 1795, 2004 Regular Session, shall be deposited into the Budget Contingency Fund created under Section 27-103-301. All of the remainder of the proceeds from the taxes imposed under this section shall be deposited into the State General Fund.
SECTION 2. Section 27-69-13, Mississippi Code of 1972, is amended as follows:
27-69-13. There is hereby imposed, levied and assessed, to be collected and paid as hereinafter provided in this chapter, an excise tax on each person or dealer in cigarettes, cigars, stogies, snuff, chewing tobacco, and smoking tobacco, or substitutes therefor, upon the sale, use, consumption, handling or distribution in the State of Mississippi, as follows:
(a) On cigarettes, the rate of tax shall be Two and Eight-twentieths Cents (2-8/20˘) on each cigarette sold with a maximum length of one hundred twenty (120) millimeters; any cigarette in excess of this length shall be taxed as if it were two (2) or more cigarettes. Provided, however, if the federal tax rate on cigarettes in effect upon the passage of Senate Bill No. 2876, 1985 Regular Session, is reduced, then the rate as provided herein shall be increased by the amount of the federal tax reduction. Such tax increase shall take effect on the first day of the month following the effective date of such reduction in the federal tax rate.
(b) On cigars, cheroots, stogies, snuff, chewing and smoking tobacco and all other tobacco products except cigarettes, the rate of tax shall be fifteen percent (15%) of the manufacturer's list price.
No stamp evidencing the tax herein levied on cigarettes shall be of a denomination of less than One Cent (1˘), and whenever the tax computed at the rates herein prescribed on cigarettes shall be a specified amount, plus a fractional part of One Cent (1˘), the package shall be stamped for the next full cent; however, the additional face value of stamps purchased to comply with taxes imposed by this section after June 1, 1985, shall be subject to a four percent (4%) discount or compensation to dealers for their services rather than the eight percent (8%) discount or compensation allowed by Section 27-69-31.
Every wholesaler shall purchase stamps as provided in this chapter, and affix the same to all packages of cigarettes handled by him as herein provided.
The above tax is levied upon the sale, use, gift, possession, or consumption of tobacco within the State of Mississippi, and the impact of the tax levied by this chapter is hereby declared to be on the vendee, user, consumer, or possessor of tobacco in this state; and when said tax is paid by any other person, such payment shall be considered as an advance payment and shall thereafter be added to the price of the tobacco and recovered from the ultimate consumer or user.
SECTION 3. Section 27-69-75, Mississippi Code of 1972, is amended as follows:
27-69-75. All taxes levied by this chapter shall be payable to the commissioner in cash, or by personal check, cashier's check, bank exchange, post office money order or express money order, and shall be deposited by the commissioner in the State Treasury on the same day collected. No remittance other than cash shall be a final discharge of liability for the tax herein assessed and levied, unless and until it has been paid in cash to the commissioner.
Except for the taxes collected from the rate equal to One and One-half Cents (1-1/2˘) on each cigarette sold, all tobacco taxes collected, including tobacco license taxes, shall be deposited into the State Treasury to the credit of the General Fund. The taxes collected from the rate equal to One and One-half Cents (1-1/2˘) on each cigarette sold shall be deposited into the State Treasury to the credit of the Budget Contingency Fund created under Section 27-103-301.
Wholesalers who are entitled to purchase stamps at a discount, as provided by Section 27-69-31, may have consigned to them, without advance payment, such stamps, if and when such wholesaler shall give to the commissioner a good and sufficient bond executed by some surety company authorized to do business in this state, conditioned to secure the payment for the stamps so consigned. The commissioner shall require payment for such stamps not later than thirty (30) days from the date the stamps were consigned.
SECTION 4. Section 27-71-307, Mississippi Code of 1972, is amended as follows:
27-71-307. (1) (a) In addition to the specific tax imposed in Section 27-71-303, there is hereby imposed, levied, assessed and shall be collected, as hereinafter provided, an excise or privilege tax upon each person engaged or continuing in the business of wholesaler or distributor of light wines or beer equivalent to Forty-seven and Sixty-eight One-hundredths Cents (47-68/100˘) per gallon upon all light wines and beer acquired for sale or distribution in this state. Such excise or privilege tax is also imposed at the same rate upon each gallon of light wine or beer manufactured by brewpubs, each of which shall accurately and reliably measure the quantity of light wine and beer produced by using a measuring device such as a meter or gauge glass or any other suitable method approved by the commissioner. Such tax is hereby imposed as an additional tax for the privilege of engaging or continuing in business.
(b) The excise tax imposed in this section shall be paid to the State Tax Commission monthly on or before the fifteenth day of the month following the month in which the beer or light wine was manufactured or received in this state. Monthly report forms shall be furnished by the commissioner to the wholesalers, distributors and brewpubs.
(c) Provided that persons operating a railroad dining car, club car or other car in interstate commerce upon which light wines or beer may be sold and who are licensed under the provisions of Section 67-3-27 and any other law relating to the sale of such beverages shall keep such records of the sales of such light wines and beer in this state as the commissioner shall prescribe and shall submit monthly reports of such sales to the commissioner within fifteen (15) days after the end of each month on a form prescribed therefor by the commissioner, and shall pay the tax due under the provisions of this section at the time such reports are filed.
No official crowns, lids, labels or stamps with the word "MISSISSIPPI" or "MS" imprinted thereon or any other evidence of tax payment is required by this section, or may be required under rule or regulation promulgated by the commissioner, to be affixed on or to any part of a beer, light wine or malt cooler bottle, can or other light wine or malt cooler container. For purposes of this section, malt cooler products shall be defined as a flavored malt beverage made from a base of malt beverage and flavored with fruit juices, aromatics and essences of other flavoring in quantities and proportions such that the resulting product possesses a character and flavor distinctive from the base malt beverage and distinguishable from other malt beverages.
(2) A licensed wholesaler or distributor of beer or light wine may not import beer or light wine from any source other than a brewer or importer authorized by the commissioner to sell such beer or light wine in Mississippi. Any person who violates the provisions of this subsection, upon conviction thereof, shall be punished by a fine of not more than One Thousand Dollars ($1,000.00) or by imprisonment in the county jail for not more than six (6) months, or by both such fine and imprisonment, in the discretion of the court and shall be subject to license forfeiture following an appropriate hearing before the State Tax Commission.
(3) The wholesaler or distributor shall be allowed credit for tax paid on beer or light wine which is no longer marketable and which is destroyed by same when such destruction is witnessed by an agent of the commissioner and when the amount of the excise tax exceeds One Hundred Dollars ($100.00). No other loss will be allowed.
A brewpub shall be allowed credit for light wine or beer which has passed through the meter, gauge glass or other approved measuring device and which has been soured or damaged. The brewpub shall record the removal of sour or damaged light wine or beer and may take credit after the destruction is witnessed by an agent of the commissioner and when the amount of excise tax exceeds Twenty-five Dollars ($25.00). No other loss shall be allowed.
(4) All manufacturers, brewers and importers of beer or light wine shall file monthly reports as prescribed by the commissioner listing sales to each wholesaler or distributor by date, invoice number, quantity and container size, and any other information deemed necessary.
(5) All administrative provisions of the Mississippi Sales Tax Law, including those which fix damages, penalties and interest for nonpayment of taxes and for noncompliance with the provisions of such chapter, and all other requirements and duties imposed upon taxpayers, shall apply to all persons liable for taxes under the provisions of this chapter, and the commissioner shall exercise all the power and authority and perform all the duties with respect to taxpayers under this chapter as are provided in the sales tax law except where there is conflict, then the provisions of this chapter shall control.
SECTION 5. Section 27-71-337, Mississippi Code of 1972, is amended as follows:
27-71-337. All taxes levied by this article and required to be paid to the commissioner shall be payable to the commissioner in cash or by personal check, cashier's check, bank exchange, post-office money order or express money order and shall be deposited by the commissioner into the State Treasury on the same day collected, provided that no remittances other than cash shall be a final discharge of liability for the tax herein imposed and levied unless and until it has been paid in cash to the commissioner.
The revenue collected from Five Cents (5˘) per gallon upon all light wines and beer shall be deposited into the State Treasury to the credit of the Budget Contingency Fund created under Section 27-103-301. All other revenue collected under this article shall be deposited into the State General Fund.
SECTION 6. Section 27-71-11, Mississippi Code of 1972, is amended as follows:
27-71-11. The commission shall from time to time by resolution request the State Bond Commission to provide sufficient funds required to maintain an adequate alcoholic beverage inventory. Said funds shall be provided under the provisions of Chapter 557, Laws of 1966.
The commission shall add to the cost of all alcoholic beverages a markup of thirty and one-half percent (30-1/2%), inclusive of the three percent (3%) markup imposed by Section 27-71-7(2).
The commission shall sell alcoholic beverages at uniform prices throughout the state.
SECTION 7. Section 27-71-29, Mississippi Code of 1972, is amended as follows:
27-71-29. All taxes levied by this article shall be paid to the State Tax Commission in cash or by personal check, cashier's check, bank exchange, post-office money order or express money order and shall be deposited by the commission in the State Treasury on the same day collected, but no remittances other than cash shall be a final discharge of liability for the tax herein imposed and levied unless and until it has been paid in cash to the State Tax Commission.
All taxes levied under Section 27-71-7(1) and received by the commission under this article shall be paid into the General Fund, and the three percent (3%) levied under Section 27-71-7(2) and received by the commission under this article shall be paid into the special fund in the State Treasury designated as the "Alcoholism Treatment and Rehabilitation Fund" as required by law. Any funds derived from the sale of alcoholic beverages in excess of inventory requirements, less the funds received from the additional three percent (3%) markup on the cost of all alcoholic beverages provided for under House Bill No. 1795, 2004 Regular Session, shall be paid not less often than annually into the General Fund. The funds received from the additional three percent (3%) markup on the cost of all alcoholic beverages provided for under House Bill No. 1795, 2004 Regular Session, shall be deposited monthly into the State Treasury to the credit of the Budget Contingency Fund created under Section 27-103-301.
SECTION 8. Section 75-76-177, Mississippi Code of 1972, is amended as follows:
75-76-177. (1) From and after August 1, 1990, through June 30, 2004, there is hereby imposed and levied on each gaming licensee a license fee based upon all the gross revenue of the licensee as follows:
(a) Four percent (4%) of all the gross revenue of the licensee which does not exceed Fifty Thousand Dollars ($50,000.00) per calendar month;
(b) Six percent (6%) of all the gross revenue of the licensee which exceeds Fifty Thousand Dollars ($50,000.00) per calendar month and does not exceed One Hundred Thirty-four Thousand Dollars ($134,000.00) per calendar month; and
(c) Eight percent (8%) of all the gross revenue of the licensee which exceeds One Hundred Thirty-four Thousand Dollars ($134,000.00) per calendar month.
(2) From and after July 1, 2004, there is hereby imposed and levied on each gaming licensee a license fee based upon all the gross revenue of the licensee as follows:
(a) Five percent (5%) of all the gross revenue of the licensee which does not exceed Fifty Thousand Dollars ($50,000.00) per calendar month;
(b) Seven percent (7%) of all the gross revenue of the licensee which exceeds Fifty Thousand Dollars ($50,000.00) per calendar month and does not exceed One Hundred Thirty-four Thousand Dollars ($134,000.00) per calendar month; and
(c) Nine percent (9%) of all the gross revenue of the licensee which exceeds One Hundred Thirty-four Thousand Dollars ($134,000.00) per calendar month.
(3) All revenue received from any game or gaming device which is leased for operation on the premises of the licensee-owner to a person other than the owner thereof or which is located in an area or space on such premises which is leased by the licensee-owner to any such person, must be attributed to the owner for the purposes of this section and be counted as part of the gross revenue of the owner. The lessee is liable to the owner for his proportionate share of such license fees.
(4) If the amount of license fees required to be reported and paid pursuant to this section is later determined to be greater or less than the amount actually reported and paid by the licensee, the Chairman of the State Tax Commission shall:
(a) Assess and collect the additional license fees determined to be due, with interest thereon until paid; or
(b) Refund any overpayment, with interest thereon, to the licensee.
Interest must be computed, until paid, at the rate of one percent (1%) per month from the first day of the first month following either the due date of the additional license fees or the date of overpayment.
(5) Failure to pay the fees provided for in this section when they are due for continuation of a license shall be deemed a surrender of the license.
SECTION 9. Section 75-76-129, Mississippi Code of 1972, is amended as follows:
[Through June 30, 2022, this section shall read as follows:]
75-76-129. On or before the last day of each month all taxes, fees, interest, penalties, damages, fines or other monies collected by the State Tax Commission during that month under the provisions of this chapter, with the exception of (a) the local government fees imposed under Section 75-76-195, * * * (b) an amount equal to Three Million Dollars ($3,000,000.00) of the revenue collected pursuant to the fee imposed under Section 75-76-177(1)(c), or an amount equal to twenty-five percent (25%) of the revenue collected pursuant to the fee imposed under Section 75-76-177(1)(c), whichever is the greater amount, and (c) the revenue collected as a result of the fee increase in Section 75-76-177(2), shall be paid by the State Tax Commission to the State Treasurer to be deposited in the State General Fund. The local government fees shall be distributed by the State Tax Commission pursuant to Section 75-76-197. An amount equal to Three Million Dollars ($3,000,000.00) of the revenue collected during that month pursuant to the fee imposed under Section 75-76-177(1)(c) shall be deposited by the State Tax Commission into the bond sinking fund created in Section 65-39-3. The revenue collected during that month pursuant to the fee imposed under Section 75-76-177(1)(c) that is in excess of Three Million Dollars ($3,000,000.00), but is less than twenty-five percent (25%) of the amount of revenue collected during that month, shall be deposited into the State Highway Fund to be used exclusively for the reconstruction and maintenance of highways of the State of Mississippi. The revenue collected as a result of the fee increase in Section 75-76-177(2), as provided in House Bill No. 1795, 2004 Regular Session, shall be deposited monthly into the State Treasury to the credit of the Budget Contingency Fund created under Section 27-103-301.
[From and after July 1, 2022, this section shall read as follows:]
75-76-129. On or before the last day of each month, all taxes, fees, interest, penalties, damages, fines or other monies collected by the State Tax Commission during that month under the provisions of this chapter, with the exception of (a) the local government fees imposed under Section 75-76-195, and (b) the revenue collected as a result of the fee increase in Section 75-76-177(2), as provided in House Bill No. 1795, 2004 Regular Session, shall be paid by the State Tax Commission to the State Treasurer to be deposited in the State General Fund. The local government fees shall be distributed by the State Tax Commission pursuant to Section 75-76-197. The revenue collected as a result of the fee increase in Section 75-76-177(2), as provided in House Bill No. 1795, 2004 Regular Session, shall be deposited monthly into the State Treasury to the credit of the Budget Contingency Fund created under Section 27-103-301.
SECTION 10. Monies deposited into Budget Contingency Fund under Sections 27-7-5, 27-69-75, 27-71-337, 27-71-29 and 75-76-129, as amended by House Bill No. 1795, 2004 Regular Session, shall be expended, upon appropriation by the Legislature as follows:
(a) Department of Mental Health...... $ 25,592,266.00
(i) Operation of crisis centers. $ 17,100,571.00
(ii) Matching funds for Medicaid
Home- and Community-Based
Services................... $ 4,000,000.00
(iii) Matching funds for services to
Medicaid patients in nursing
homes and ICF/MRs of the
department................ $ 4,491,695.00
(b) State Board of Education......... $144,442,209.00
(i) Teacher pay raise........... $ 98,000,000.00
(ii) Additional Mississippi Adequate
Education critical needs... $ 23,504,970.00
(iii) Restore teacher supply
funds..................... $ 15,900,000.00
(iv) Teacher salary supplements for
national board certification$ 1,359,881.00
(v) Severely disabled educable
children's program.......... $ 701,459.00
(vi) Critical needs teachers shortage
scholarships............... $ 901,493.00
(vii) School attendance officers$ 668,618.00
(viii) Vocational educational
needs..................... $ 1,087,404.00
(ix) Mississippi Schools for the
the Blind and Deaf....... $ 2,318,384.00
(c) Department of Human Services, for
child care assistance and community
family resource centers.......... $ 10,300,000.00
(d) Department of Rehabilitation
Services......................... $ 1,405,779.00
(i) Office of Vocational Rehabilitation
for the Blind as follows:
1. Salaries, wages and
fringe benefits......... $ 543,350.00
2. Travel and subsistence.. $ 12,399.00
3. Contractual services.... $ 23,431.00
4. Equipment............... $ 22,243.00
5. Subsidies, loans and
grants.................. $ 304,356.00
(ii) Office of Special Disability
Programs, for subsidies, loans
and grants................. $ 500,000.00
SECTION 11. This act shall take effect and be in force from and after July 1, 2004, except for Sections 1 and 2, which shall take effect and be in force from and after January 1, 2004.