Senate Bill 2321

AN ACT TO EXEMPT FROM AD VALOREM TAXATION ALL COMMODITIES, GOODS, WARES AND MERCHANDISE HELD FOR RESALE BY ANY MANUFACTURER, DISTRIBUTOR OR WHOLESALE OR RETAIL MERCHANT; TO AMEND SECTION 27-7-22.5, MISSISSIPPI CODE OF 1972, IN CONFORMITY THERETO; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. From and after January 1, 2005, all commodities, goods, wares and merchandise held for resale by any manufacturer, distributor or wholesale or retail merchant shall be exempt from ad valorem taxation.

SECTION 2. Section 27-7-22.5, Mississippi Code of 1972, is amended as follows:

27-7-22.5. (1) For any manufacturer, distributor, wholesale or retail merchant who pays to a county, municipality, school district, levee district or any other taxing authority of the state or a political subdivision thereof, ad valorem taxes imposed on commodities, products, goods, wares and merchandise held for resale, a credit against the income taxes imposed under this chapter shall be allowed for the portion of the ad valorem taxes so paid in the amounts prescribed in subsection (2).

(2) The tax credit allowed by this section shall not exceed the amounts set forth in paragraphs (a) through (d) of this subsection; may be claimed only in the year in which the ad valorem taxes are paid; and may be claimed for each location where such commodities, products, goods, wares and merchandise are found and upon which the ad valorem taxes have been paid.

(a) For the 1994 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Two Thousand Dollars ($2,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(b) For the 1995 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Three Thousand Dollars ($3,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(c) For the 1996 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Four Thousand Dollars ($4,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(d) For the 1997 taxable year and each taxable year thereafter through the 2004 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Five Thousand Dollars ($5,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(3) Any amount of ad valorem taxes paid by a taxpayer that is applied toward the tax credit allowed in this section may not be used as a deduction by the taxpayer for state income tax purposes. In the case of a taxpayer that is a partnership or S corporation, the credit may be applied only to the tax attributable to partnership or S corporation income derived from the taxpayer.

SECTION 3. This act shall take effect and be in force from and after January 1, 2005.