Adopted

COMMITTEE AMENDMENT NO 1 PROPOSED TO

Senate Bill No. 3095

BY: Committee

     Amend by striking all after the enacting clause and inserting in lieu thereof the following:

SECTION 1.  This act shall be known and may be cited as the "House Bill No. 1 of the 2025 Regular Session, the Build Up Mississippi Act".

     SECTION 2.  Section 27-7-5, Mississippi Code of 1972, is amended as follows:

     27-7-5.  (1)  (a)  Except as otherwise provided in this section, 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:

              (i)  1.  Through calendar year 2017, on the first Five Thousand Dollars ($5,000.00) of taxable income, or any part thereof, the rate shall be three percent (3%);

                   2.  For calendar year 2018, on the first One Thousand Dollars ($1,000.00) of taxable income there shall be no tax levied, and on the next Four Thousand Dollars ($4,000.00) of taxable income, or any part thereof, the rate shall be three percent (3%);

                   3.  For calendar year 2019, on the first Two Thousand Dollars ($2,000.00) of taxable income there shall be no tax levied, and on the next Three Thousand Dollars ($3,000.00) of taxable income, or any part thereof, the rate shall be three percent (3%);

                   4.  For calendar year 2020, on the first Three Thousand Dollars ($3,000.00) of taxable income there shall be no tax levied, and on the next Two Thousand Dollars ($2,000.00) of taxable income, or any part thereof, the rate shall be three percent (3%);

                   5.  For calendar year 2021, on the first Four Thousand Dollars ($4,000.00) of taxable income there shall be no tax levied, and on the next One Thousand Dollars ($1,000.00) of taxable income, or any part thereof, the rate shall be three percent (3%);

                   6.  For calendar year 2022 and all taxable years thereafter, there shall be no tax levied on the first Five Thousand Dollars ($5,000.00) of taxable income;

              (ii)  On taxable income in excess of Five Thousand Dollars ($5,000.00) up to and including Ten Thousand Dollars ($10,000.00), or any part thereof, the rate shall be four percent (4%); and

              (iii)  On all taxable income in excess of Ten Thousand Dollars ($10,000.00), the rate shall be five percent (5%).

          (b)  (i)  For calendar year 2023 and all calendar years thereafter, there shall be no tax levied under subparagraph (ii) of paragraph (a) of this subsection on the taxable income of individuals in excess of Five Thousand Dollars ($5,000.00) up to and including Ten Thousand Dollars ($10,000.00), or any part thereof; and

              (ii)  For calendar year 2024 and all calendar years thereafter, the tax imposed under subparagraph (iii) of paragraph (a) of this subsection upon all taxable income of individuals in excess of Ten Thousand Dollars ($10,000.00), shall be at the following rates:

                   1.  For calendar year 2024, on such taxable income, the rate shall be four and seven-tenths percent (4.7%);

                   2.  For calendar year 2025, on such taxable income, the rate shall be four and four-tenths percent (4.4%); * * *and

                   3.  For calendar year 2026 * * *and all calendar years thereafter, on such taxable income, the rate shall be four percent (4%);

4.  For calendar year 2027, on such taxable income, the rate shall be three and five-tenths percent (3.5%);

5.  For calendar year 2028, on such taxable income, the rate shall be three percent (3.0%);

6.  For calendar year 2029, on such taxable income, the rate shall be two and seven-tenths percent (2.7%);

7.  For calendar year 2030, on such taxable income, the rate shall be two and four-tenths percent (2.4%);

8.  For calendar year 2031, on such taxable income, the rate shall be two and one-tenths percent (2.1%);

9.  For calendar year 2032, on such taxable income, the rate shall be one and eight-tenths percent (1.8%);

10.  For calendar year 2033, on such taxable income, the rate shall be one and five-tenths percent (1.5%);

11.  For calendar year 2034, on such taxable income, the rate shall be one and two-tenths percent (1.2%);

12.  For calendar year 2035, on such taxable income, the rate shall be nine-tenths of one percent (.9%);

13.  For calendar year 2036, on such taxable income, the rate shall be six-tenths of one percent (.6%); and

14.  For calendar year 2037 and all calendar years thereafter, there shall be no tax levied under subparagraph (iii) of paragraph (a) of this subsection upon taxable income of individuals in excess of Ten Thousand Dollars ($10,000.00).

 * * *It is the intent of the Legislature that before calendar year 2026, the Legislature will consider whether the revised tax rates provided for in this subparagraph (ii) will be further decreased for calendar years after calendar year 2026.  If the revised tax rates provided for in this subparagraph (ii) are further decreased for calendar years after calendar year 2026 to the extent that there is no tax levied on the taxable income of individuals under this subparagraph (ii), the individual income tax shall stand repealed.

(c)  However, notwithstanding any other provision of this section to the contrary, for calendar year 2025 and each calendar year thereafter, the tax imposed under this section, upon all taxable income of individuals that is derived from illegal activity and for income derived from producing, distributing, directing, manufacturing, issuing, publishing or advertising any depiction of sexually explicit conduct shall be at the rate of five percent (5%).  For the purposes of this paragraph (c), "sexually explicit conduct" has the meaning ascribed to such term in Section 97-5-31, notwithstanding whether depicting conduct by an adult or child.

     (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, collected 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)  In the case of taxpayers having a fiscal year beginning in a calendar year with a rate in effect that is different than the rate in effect for the next calendar year and ending in the next calendar year, 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 in which the fiscal year begins; 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 in which the fiscal year ends; 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.

     SECTION 3.  Section 27-65-17, Mississippi Code of 1972, is amended as follows:

     27-65-17.  (1)  (a)  Except as otherwise provided in this section, upon every person engaging or continuing within this state in the business of selling any tangible personal property whatsoever there is hereby levied, assessed and shall be collected a tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross proceeds of the retail sales of the business.

          (b)  Retail sales of farm tractors and parts and labor used to maintain and/or repair such tractors shall be taxed at the rate of one and one-half percent (1-1/2%) when made to farmers for agricultural purposes.

          (c)  (i)  Retail sales of farm implements sold to farmers and used directly in the production of poultry, ratite, domesticated fish as defined in Section 69-7-501, livestock, livestock products, agricultural crops or ornamental plant crops or used for other agricultural purposes, and parts and labor used to maintain and/or repair such implements, shall be taxed at the rate of one and one-half percent (1-1/2%) when used on the farm.

              (ii)  The one and one-half percent (1-1/2%) rate shall also apply to all equipment used in logging, pulpwood operations or tree farming, and parts and labor used to maintain and/or repair such equipment, which is either:

                   1.  Self-propelled, or

                   2.  Mounted so that it is permanently attached to other equipment which is self-propelled or attached to other equipment drawn by a vehicle which is self-propelled.

     In order to be eligible for the rate of tax provided for in this subparagraph (ii), such sales must be made to a professional logger.  For the purposes of this subparagraph (ii), a "professional logger" is a person, corporation, limited liability company or other entity, or an agent thereof, who possesses a professional logger's permit issued by the Department of Revenue and who presents the permit to the seller at the time of purchase.  The department shall establish an application process for a professional logger's permit to be issued, which shall include a requirement that the applicant submit a copy of documentation verifying that the applicant is certified according to Sustainable Forestry Initiative guidelines.  Upon a determination that an applicant is a professional logger, the department shall issue the applicant a numbered professional logger's permit.

          (d)  Except as otherwise provided in subsection (3) of this section, retail sales of aircraft, automobiles, trucks, truck-tractors, semitrailers and manufactured or mobile homes shall be taxed at the rate of three percent (3%).

          (e)  Sales of manufacturing machinery or manufacturing machine parts when made to a manufacturer or custom processor for plant use only when the machinery and machine parts will be used exclusively and directly within this state in manufacturing a commodity for sale, rental or in processing for a fee shall be taxed at the rate of one and one-half percent (1-1/2%).

          (f)  Sales of machinery and machine parts when made to a technology intensive enterprise for plant use only when the machinery and machine parts will be used exclusively and directly within this state for industrial purposes, including, but not limited to, manufacturing or research and development activities, shall be taxed at the rate of one and one-half percent (1-1/2%).  In order to be considered a technology intensive enterprise for purposes of this paragraph:

              (i)  The enterprise shall meet minimum criteria established by the Mississippi Development Authority;

              (ii)  The enterprise shall employ at least ten (10) persons in full-time jobs;

              (iii)  At least ten percent (10%) of the workforce in the facility operated by the enterprise shall be scientists, engineers or computer specialists;

               (iv)  The enterprise shall manufacture plastics, chemicals, automobiles, aircraft, computers or electronics; or shall be a research and development facility, a computer design or related facility, or a software publishing facility or other technology intensive facility or enterprise as determined by the Mississippi Development Authority;

              (v)  The average wage of all workers employed by the enterprise at the facility shall be at least one hundred fifty percent (150%) of the state average annual wage; and

              (vi)  The enterprise must provide a basic health care plan to all employees at the facility.

     A medical cannabis establishment, as defined in the Mississippi Medical Cannabis Act, shall not be considered to be a technology intensive enterprise for the purposes of this paragraph (f).

          (g)  Sales of materials for use in track and track structures to a railroad whose rates are fixed by the Interstate Commerce Commission or the Mississippi Public Service Commission shall be taxed at the rate of three percent (3%).

          (h)  Sales of tangible personal property to electric power associations for use in the ordinary and necessary operation of their generating or distribution systems shall be taxed at the rate of one percent (1%).

          (i)  Wholesale sales of food and drink for human consumption to full-service vending machine operators to be sold through vending machines located apart from and not connected with other taxable businesses shall be taxed at the rate of eight percent (8%).

          (j)  Sales of equipment used or designed for the purpose of assisting disabled persons, such as wheelchair equipment and lifts, that is mounted or attached to or installed on a private carrier of passengers or light carrier of property, as defined in Section 27-51-101, at the time when the private carrier of passengers or light carrier of property is sold shall be taxed at the same rate as the sale of such vehicles under this section.

          (k)  Sales of the factory-built components of modular homes, panelized homes and precut homes, and panel constructed homes consisting of structural insulated panels, shall be taxed at the rate of three percent (3%).

          (l)  Sales of materials used in the repair, renovation, addition to, expansion and/or improvement of buildings and related facilities used by a dairy producer shall be taxed at the rate of three and one-half percent (3-1/2%).  For the purposes of this paragraph (l), "dairy producer" means any person engaged in the production of milk for commercial use.

          (m)  Sales of equipment and materials used in connection with geophysical surveying, exploring, developing, drilling, redrilling, completing, working over, producing, distributing, or testing of oil, gas and other mineral resources shall be taxed at the rate of four and one-half percent (4-1/2%).  Operators that rebill sales of equipment and materials to nonoperating working interest owners on behalf of a joint account through the joint interest billing (JIB), where the sales tax has been paid or accrued by the operator shall not be charged a sales tax on the JIB as services income.

(n)  From and after July 1, 2026, retail sales of food for human consumption not purchased with food stamps issued by the United States Department of Agriculture, or other federal agency, but which would be exempt under Section 27-65-111(o) from the taxes imposed by this chapter if the food items were purchased with food stamps, shall be taxed at the rate of five percent (5%).

     (2)  From and after January 1, 1995, retail sales of private carriers of passengers and light carriers of property, as defined in Section 27-51-101, shall be taxed an additional two percent (2%).

     (3)  A manufacturer selling at retail in this state shall be required to make returns of the gross proceeds of such sales and pay the tax imposed in this section.

     SECTION 4.  Section 27-65-19, Mississippi Code of 1972, is amended as follows:

27-65-19.  (1)  (a)  (i)  Except as otherwise provided in this subsection, upon every person selling to consumers, electricity, current, power, potable water, steam, coal, natural gas, liquefied petroleum gas or other fuel, there is hereby levied, assessed and shall be collected a tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income of the business.  Provided, gross income from sales to consumers of electricity, current, power, natural gas, liquefied petroleum gas or other fuel for residential heating, lighting or other residential noncommercial or nonagricultural use, and sales of potable water for residential, noncommercial or nonagricultural use shall be excluded from taxable gross income of the business.  Provided further, upon every such seller using electricity, current, power, potable water, steam, coal, natural gas, liquefied petroleum gas or other fuel for nonindustrial purposes, there is hereby levied, assessed and shall be collected a tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the cost or value of the product or service used.

          (ii)  Gross income from sales to a church that is exempt from federal income taxation under 26 USCS Section 501(c)(3) of electricity, current, power, natural gas, liquefied petroleum gas or other fuel for heating, lighting or other use, and sales of potable water to such a church shall be excluded from taxable gross income of the business if the electricity, current, power, natural gas, liquefied petroleum gas or potable water is utilized on property that is primarily used for religious or educational purposes.

          (b)  (i)  There is hereby levied, assessed and shall be collected a tax equal to one and one-half percent (1-1/2%) of the gross income of the business from the sale of naturally occurring carbon dioxide and anthropogenic carbon dioxide lawfully injected into the earth for:

                   1.  Use in an enhanced oil recovery project, including, but not limited to, use for cycling, repressuring or lifting of oil; or

                   2.  Permanent sequestration in a geological formation.

              (ii)  The one and one-half percent (1-1/2%) rate provided for in this subsection shall apply to electricity, current, power, steam, coal, natural gas, liquefied petroleum gas or other fuel that is sold to a producer of oil and gas for use directly in enhanced oil recovery using carbon dioxide and/or the permanent sequestration of carbon dioxide in a geological formation.

          (c)  The one and one-half percent (1-1/2%) rate provided for in this subsection shall not apply to sales of fuel for automobiles, trucks, truck-tractors, buses, farm tractors or airplanes.

          (d)  (i)  Upon every person providing services in this state, there is hereby levied, assessed and shall be collected:

                   1.  A tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income received from all charges for intrastate telecommunications services.

                   2.  A tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income received from all charges for interstate telecommunications services.

                   3.  A tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income received from all charges for international telecommunications services.

                   4.  A tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income received from all charges for ancillary services.

     Sales of computer software, computer software services, specified digital products, or other products delivered electronically, including, but not limited to, music, games, reading materials or ring tones, shall be taxed as provided in other sections of this chapter.

              (ii)  A person, upon proof that he has paid a tax in another state on an event described in subparagraph (i) of this paragraph (d), shall be allowed a credit against the tax imposed in this paragraph (d) on interstate telecommunications service charges to the extent that the amount of such tax is properly due and actually paid in such other state and to the extent that the rate of sales tax imposed by and paid in such other state does not exceed the rate of sales tax imposed by this paragraph (d).

              (iii)  Charges by one (1) telecommunications provider to another telecommunications provider holding a permit issued under Section 27-65-27 for services that are resold by such other telecommunications provider, including, but not limited to, access charges, shall not be subject to the tax levied pursuant to this paragraph (d).

              (iv)  For purposes of this paragraph (d):

                   1.  "Telecommunications service" means the electronic transmission, conveyance or routing of voice, data, audio, video or any other information or signals to a point, or between points.  The term "telecommunications service" includes such transmission, conveyance or routing in which computer processing applications are used to act on the form, code or protocol of the content for purposes of transmission, conveyance or routing without regard to whether such service is referred to as Voice over Internet Protocol services or is classified by the Federal Communications Commission as enhanced or value added.  The term "telecommunications service" shall not include:

                        a.  Data processing and information services that allow data to be generated, acquired, stored, processed or retrieved and delivered by an electronic transmission to a purchaser where such purchaser's primary purpose for the underlying transaction is the processed data or information;

                        b.  Installation or maintenance of wiring or equipment on a customer's premises;

                        c.  Tangible personal property;

                        d.  Advertising, including, but not limited to, directory advertising;

                        e.  Billing and collection services provided to third parties;

                        f.  Internet access service;

                        g.  Radio and television audio and video programming services regardless of the medium, including the furnishing of transmission, conveyance and routing of such services by the programming service provider.  Radio and television audio and video programming services shall include, but not be limited to, cable service as defined in 47 USCS 522(6) and audio and video programming services delivered by commercial mobile radio service providers, as defined in 47 CFR 20.3;

                        h.  Ancillary services; or

                        i.  Digital products delivered electronically, including, but not limited to, computer software, computer software services, electronically stored or maintained data, music, video, reading materials, specified digital products, or ring tones.

                   2.  "Ancillary services" means services that are associated with or incidental to the provision of telecommunications services, including, but not limited to, detailed telecommunications billing, directory assistance, vertical service and voice mail service.

                        a.  "Conference bridging" means an ancillary service that links two (2) or more participants of an audio or video conference call and may include the provision of a telephone number.  Conference bridging does not include the telecommunications services used to reach the conference bridge.

                        b.  "Detailed telecommunications billing service" means an ancillary service of separately stating information pertaining to individual calls on a customer's billing statement.

                        c.  "Directory assistance" means an ancillary service of providing telephone number information and/or address information.

                        d.  "Vertical service" means an ancillary service that is offered in connection with one or more telecommunications services, which offers advanced calling features that allow customers to identify callers and to manage multiple calls and call connections, including conference bridging services.

                        e.  "Voice mail service" means an ancillary service that enables the customer to store, send or receive recorded messages.  Voice mail service does not include any vertical services that the customer may be required to have in order to utilize the voice mail service.

                   3.  "Intrastate" means telecommunications service that originates in one (1) United States state or United States territory or possession, and terminates in the same United States state or United States territory or possession.

                   4.  "Interstate" means a telecommunications service that originates in one (1) United States state or United States territory or possession, and terminates in a different United States state or United States territory or possession.

                   5.  "International" means a telecommunications service that originates or terminates in the United States and terminates or originates outside the United States, respectively.

              (v)  For purposes of paragraph (d), the following sourcing rules shall apply:

                   1.  Except for the defined telecommunications services in item 3 of this subparagraph, the sales of telecommunications services sold on a call-by-call basis shall be sourced to:

                        a.  Each level of taxing jurisdiction where the call originates and terminates in that jurisdiction, or

                        b.  Each level of taxing jurisdiction where the call either originates or terminates and in which the service address is also located.

                   2.  Except for the defined telecommunications services in item 3 of this subparagraph, a sale of telecommunications services sold on a basis other than a call-by-call basis, is sourced to the customer's place of primary use.

                   3.  The sale of the following telecommunications services shall be sourced to each level of taxing jurisdiction as follows:

                        a.  A sale of mobile telecommunications services other than air-to-ground radiotelephone service and prepaid calling service is sourced to the customer's place of primary use as required by the Mobile Telecommunication Sourcing Act.

                             A.  A home service provider shall be responsible for obtaining and maintaining the customer's place of primary use.  The home service provider shall be entitled to rely on the applicable residential or business street address supplied by such customer, if the home service provider's reliance is in good faith; and the home service provider shall be held harmless from liability for any additional taxes based on a different determination of the place of primary use for taxes that are customarily passed on to the customer as a separate itemized charge.  A home service provider shall be allowed to treat the address used for purposes of the tax levied by this chapter for any customer under a service contract in effect on August 1, 2002, as that customer's place of primary use for the remaining term of such service contract or agreement, excluding any extension or renewal of such service contract or agreement.  Month-to-month services provided after the expiration of a contract shall be treated as an extension or renewal of such contract or agreement.

                             B.  If the commissioner determines that the address used by a home service provider as a customer's place of primary use does not meet the definition of the term "place of primary use" as defined in subitem a.A. of this item 3, the commissioner shall give binding notice to the home service provider to change the place of primary use on a prospective basis from the date of notice of determination; however, the customer shall have the opportunity, prior to such notice of determination, to demonstrate that such address satisfies the definition.

                             C.  The department has the right to collect any taxes due directly from the home service provider's customer that has failed to provide an address that meets the definition of the term "place of primary use" which resulted in a failure of tax otherwise due being remitted.

                        b.  A sale of postpaid calling service is sourced to the origination point of the telecommunications signal as first identified by either:

                             A.  The seller's telecommunications system; or

                             B.  Information received by the seller from its service provider, where the system used to transport such signals is not that of the seller.

                        c.  A sale of a prepaid calling service or prepaid wireless calling service shall be subject to the tax imposed by this paragraph if the sale takes place in this state.  If the customer physically purchases a prepaid calling service or prepaid wireless calling service at the vendor's place of business, the sale is deemed to take place at the vendor's place of business.  If the customer does not physically purchase the service at the vendor's place of business, the sale of a prepaid calling card or prepaid wireless calling card is deemed to take place at the first of the following locations that applies to the sale:

                             A.  The customer's shipping address, if the sale involves a shipment;

                             B.  The customer's billing address;

                             C.  Any other address of the customer that is known by the vendor; or

                             D.  The address of the vendor, or alternatively, in the case of a prepaid wireless calling service, the location associated with the mobile telephone number.

                   4.  A sale of a private communication service is sourced as follows:

                        a.  Service for a separate charge related to a customer channel termination point is sourced to each level of jurisdiction in which such customer channel termination point is located.

                        b.  Service where all customer termination points are located entirely within one (1) jurisdiction or levels of jurisdiction is sourced in such jurisdiction in which the customer channel termination points are located.

                        c.  Service for segments of a channel between two (2) customer channel termination points located in different jurisdictions and which segments of a channel are separately charged is sourced fifty percent (50%) in each level of jurisdiction in which the customer channel termination points are located.

                        d.  Service for segments of a channel located in more than one (1) jurisdiction or levels of jurisdiction and which segments are not separately billed is sourced in each jurisdiction based on the percentage determined by dividing the number of customer channel termination points in such jurisdiction by the total number of customer channel termination points.

                   5.  A sale of ancillary services is sourced to the customer's place of primary use.

              (vi)  For purposes of subparagraph (v) of this paragraph (d):

                   1.  "Air-to-ground radiotelephone service" means a radio service, as that term is defined in 47 CFR 22.99, in which common carriers are authorized to offer and provide radio telecommunications service for hire to subscribers in aircraft.

                   2.  "Call-by-call basis" means any method of charging for telecommunications services where the price is measured by individual calls.

                   3.  "Communications channel" means a physical or virtual path of communications over which signals are transmitted between or among customer channel termination points.

                   4.  "Customer" means the person or entity that contracts with the seller of telecommunications services.  If the end user of telecommunications services is not the contracting party, the end user of the telecommunications service is the customer of the telecommunications service.  Customer does not include a reseller of telecommunications service or for mobile telecommunications service of a serving carrier under an agreement to serve the customer outside the home service provider's licensed service area.

                   5.  "Customer channel termination point" means the location where the customer either inputs or receives the communications.

                   6.  "End user" means the person who utilizes the telecommunications service.  In the case of an entity, "end user" means the individual who utilizes the service on behalf of the entity.

                   7.  "Home service provider" has the meaning ascribed to such term in Section 124(5) of Public Law 106-252 (Mobile Telecommunications Sourcing Act).

                   8.  "Mobile telecommunications service" has the meaning ascribed to such term in Section 124(7) of Public Law 106-252 (Mobile Telecommunications Sourcing Act).

                   9.  "Place of primary use" means the street address representative of where the customer's use of the telecommunications service primarily occurs, which must be the residential street address or the primary business street address of the customer.  In the case of mobile telecommunications services, the place of primary use must be within the licensed service area of the home service provider.

                   10.  "Post-paid calling service" means the telecommunications service obtained by making a payment on a call-by-call basis either through the use of a credit card or payment mechanism such as a bank card, travel card, credit card or debit card, or by charge made to a telephone number which is not associated with the origination or termination of the telecommunications service.  A post-paid calling service includes a telecommunications service, except a prepaid wireless calling service that would be a prepaid calling service except it is not exclusively a telecommunications service.

                   11.  "Prepaid calling service" means the right to access exclusively telecommunications services, which must be paid for in advance and which enables the origination of calls using an access number or authorization code, whether manually or electronically dialed, and that is sold in predetermined units or dollars of which the number declines with use in a known amount.

                   12.  "Prepaid wireless calling service" means a telecommunications service that provides the right to utilize mobile wireless service as well as other nontelecommunications services, including the download of digital products delivered electronically, content and ancillary service, which must be paid for in advance that is sold in predetermined units or dollars of which the number declines with use in a known amount.

                   13.  "Private communication service" means a telecommunications service that entitles the customer to exclusive or priority use of a communications channel or group of channels between or among termination points, regardless of the manner in which such channel or channels are connected, and includes switching capacity, extension lines, stations and any other associated services that are provided in connection with the use of such channel or channels.

                   14.  "Service address" means:

                        a.  The location of the telecommunications equipment to which a customer's call is charged and from which the call originates or terminates, regardless of where the call is billed or paid.

                        b.  If the location in subitem a of this item 14 is not known, the origination point of the signal of the telecommunications services first identified by either the seller's telecommunications system or in information received by the seller from its service provider, where the system used to transport such signals is not that of the seller.

                        c.  If the location in subitems a and b of this item 14 are not known, the location of the customer's place of primary use.

              (vii)  1.  For purposes of this subparagraph (vii), "bundled transaction" means a transaction that consists of distinct and identifiable properties or services which are sold for a single nonitemized price but which are treated differently for tax purposes.

                   2.  In the case of a bundled transaction that includes telecommunications services, ancillary services, internet access, or audio or video programming services taxed under this chapter in which the price of the bundled transaction is attributable to properties or services that are taxable and nontaxable, the portion of the price that is attributable to any nontaxable property or service shall be subject to the tax unless the provider can reasonably identify that portion from its books and records kept in the regular course of business.

                   3.  In the case of a bundled transaction that includes telecommunications services, ancillary services, internet access, audio or video programming services subject to tax under this chapter in which the price is attributable to properties or services that are subject to the tax but the tax revenue from the different properties or services are dedicated to different funds or purposes, the provider shall allocate the price among the properties or services:

                        a.  By reasonably identifying the portion of the price attributable to each of the properties and services from its books and records kept in the regular course of business; or

                        b.  Based on a reasonable allocation methodology approved by the department.

                   4.  This subparagraph (vii) shall not create a right of action for a customer to require that the provider or the department, for purposes of determining the amount of tax applicable to a bundled transaction, allocate the price to the different portions of the transaction in order to minimize the amount of tax charged to the customer.  A customer shall not be entitled to rely on the fact that a portion of the price is attributable to properties or services not subject to tax unless the provider elects, after receiving a written request from the customer in the form required by the provider, to provide verifiable data based upon the provider's books and records that are kept in the regular course of business that reasonably identifies the portion of the price attributable to the properties or services not subject to the tax.

     (2)  Persons making sales to consumers of electricity, current, power, natural gas, liquefied petroleum gas or other fuel for residential heating, lighting or other residential noncommercial or nonagricultural use or sales of potable water for residential, noncommercial or nonagricultural use shall indicate on each statement rendered to customers that such charges are exempt from sales taxes.

     (3)  There is hereby levied, assessed and shall be paid on transportation charges on shipments moving between points within this state when paid directly by the consumer, a tax equal to the rate applicable to the sale of the property being transported.  Such tax shall be reported and paid directly to the Department of Revenue by the consumer.

     SECTION 5.  Section 27-65-22, Mississippi Code of 1972, is amended as follows:

     27-65-22.  (1)  Upon every person engaging or continuing in any amusement business or activity, which shall include all manner and forms of entertainment and amusement, all forms of diversion, sport, recreation or pastime, shows, exhibitions, contests, displays, games or any other and all methods of obtaining admission charges, donations, contributions or monetary charges of any character, from the general public or a limited or selected number thereof, directly or indirectly in return for other than tangible property or specific personal or professional services, whether such amusement is held or conducted in a public or private building, hotel, tent, pavilion, lot or resort, enclosed or in the open, there is hereby levied, assessed and shall be collected a tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income received as admission, except as otherwise provided herein.  In lieu of the rate set forth above, there is hereby imposed, levied and assessed, to be collected as hereinafter provided, a tax of three percent (3%) of gross revenue derived from sales of admission to publicly owned enclosed coliseums and auditoriums (except admissions to athletic contests between colleges and universities).  There is hereby imposed, levied and assessed a tax of seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of gross revenue derived from sales of admission to events conducted on property managed by the Mississippi Veterans Memorial Stadium, which tax shall be administered in the manner prescribed in this chapter, subject, however, to the provisions of Sections 55-23-3 through 55-23-11.

     (2)  The operator of any place of amusement in this state shall collect the tax imposed by this section, in addition to the price charged for admission to any place of amusement, and under all circumstances the person conducting the amusement shall be liable for, and pay the tax imposed based upon the actual charge for such admission.  Where permits are obtained for conducting temporary amusements by persons who are not the owners, lessees or custodians of the buildings, lots or places where the amusements are to be conducted, or where such temporary amusement is permitted by the owner, lessee or custodian of any place to be conducted without the procurement of a permit as required by this chapter, the tax imposed by this chapter shall be paid by the owner, lessee or custodian of such place where such temporary amusement is held or conducted, unless paid by the person conducting the amusement, and the applicant for such temporary permit shall furnish with the application therefor, the name and address of the owner, lessee or custodian of the premises upon which such amusement is to be conducted, and such owner, lessee or custodian shall be notified by the commission of the issuance of such permit, and of the joint liability for such tax.

     (3)  The tax imposed by this section shall not be levied or collected upon:

          (a)  Any admissions charged at any place of amusement operated by a religious, charitable or educational organization, or by a nonprofit civic club or fraternal organization (i) when the net proceeds of such admissions do not inure to any one or more individuals within such organization and are to be used solely for religious, charitable, educational or civic purposes; or (ii) when the entire net proceeds are used to defray the normal operating expenses of such organization, such as loan payments, maintenance costs, repairs and other operating expenses;

          (b)  Any admissions charged to hear gospel singing when promoted by a duly constituted local, bona fide nonprofit charitable or religious organization, irrespective of the fact that the performers and promoters are paid out of the proceeds of admissions collected, provided the program is composed entirely of gospel singing and not generally mixed with hillbilly or popular singing;

          (c)  Any admissions charged at any athletic games or contests between high schools or between grammar schools;

          (d)  Any admissions or tickets to or for baseball games between teams operated under a professional league franchise;

          (e)  Any admissions to county, state or community fairs, or any admissions to entertainments presented in community homes or houses which are publicly owned and controlled, and the proceeds of which do not inure to any individual or individuals;

          (f)  Any admissions or tickets to organized garden pilgrimages and to antebellum and historic houses when sponsored by an organized civic or garden club;

          (g)  Any admissions to any golf tournament held under the auspices of the Professional Golf Association or United States Golf Association wherein touring professionals compete, if such tournament is sponsored by a nonprofit association incorporated under the laws of the State of Mississippi where no dividends are declared and the proceeds do not inure to any individual or group;

          (h)  Any admissions to university or community college conference, state, regional or national playoffs or championships;

          (i)  Any admissions or fees charged by any county or municipally owned and operated swimming pools, golf courses and tennis courts other than sales or rental of tangible personal property;

          (j)  Any admissions charged for the performance of symphony orchestras, operas, vocal or instrumental artists in which professional or amateur performers are compensated out of the proceeds of such admissions, when sponsored by local music or charity associations, or amateur dramatic performances or professional dramatic productions when sponsored by a children's dramatic association, where no dividends are declared, profits received, nor any salary or compensation paid to any of the members of such associations, or to any person for procuring or producing such performance;

          (k)  Any admissions or tickets to or for hockey games between teams operated under a professional league franchise;

          (l)  Any admissions or tickets to or for events sanctioned by the Mississippi Athletic Commission that are held within publicly owned enclosed coliseums and auditoriums;

          (m)  Guided tours on any navigable waters of this state, which include providing accommodations, guide services and/or related equipment operated by or under the direction of the person providing the tour, for the purposes of outdoor tourism;

          (n)  Any admissions to events held solely for religious or charitable purposes at livestock facilities, agriculture facilities or other facilities constructed, renovated or expanded with funds from the grant program authorized under Section 18 of Chapter 530, Laws of 1995; and

          (o)  (i)  Any admissions charged at events, activities or entertainments:

                   1.  Which are open to the public and held in or on parks, lands or buildings which are publicly owned, leased, used and/or controlled by a municipality, or any agency thereof;

                   2.  Which are created and sponsored by the municipality, or an agency thereof; and

                   3.  The proceeds of which do not inure to the benefit of any individual or individuals; however,

              (ii)  The governing authorities of a municipality may require the tax imposed by this section to be levied and collected at events, activities or entertainments described in subparagraph (i) of this paragraph by:

                   1.  Adopting an ordinance requiring the levy and collection of the tax;

                   2.  Providing the Department of Revenue with a certified copy of the ordinance requiring the tax to be levied and assessed at least thirty (30) days prior to the effective date of the ordinance;

              (iii)  If the ordinance described in subparagraph (ii) of this paragraph is repealed, the municipality shall provide the Department of Revenue with a certified copy of the repeal of the ordinance at least thirty (30) days prior to the effective date of the repeal.

     SECTION 6.  Section 27-65-23, Mississippi Code of 1972, is amended as follows:

     27-65-23.  Upon every person engaging or continuing in any of the following businesses or activities there is hereby levied, assessed and shall be collected a tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income of the business, except as otherwise provided:

          Air-conditioning installation or repairs;

          Automobile, motorcycle, boat or any other vehicle repairing or servicing;

          Billiards, pool or domino parlors;

          Bowling or tenpin alleys;

          Burglar and fire alarm systems or services;

          Car washing — automatic, self-service, or manual;

          Computer software services actually performed within this state;

          Cotton compresses or cotton warehouses;

          Custom creosoting or treating, custom planing, custom sawing;

          Custom meat processing;

          Electricians, electrical work, wiring, all repairs or installation of electrical equipment;

          Elevator or escalator installing, repairing or servicing;

          Film developing or photo finishing;

          Foundries, machine or general repairing;

          Furniture repairing or upholstering;

          Grading, excavating, ditching, dredging or landscaping;

          Hotels (as defined in Section 41-49-3), motels, tourist courts or camps, trailer parks;

          Insulating services or repairs;

          Jewelry or watch repairing;

          Laundering, cleaning, pressing or dyeing;

          Marina services;

          Mattress renovating;

          Office and business machine repairing;

          Parking garages and lots;

          Plumbing or pipe fitting;

          Public storage warehouses (There shall be no tax levied on gross income of a public storage warehouse derived from the temporary storage of tangible personal property in this state pending shipping or mailing of the property to another state.);

          Refrigerating equipment repairs;

          Radio or television installing, repairing, or servicing;

          Renting or leasing personal property used within this state;

          Services performed in connection with geophysical surveying, exploring, developing, drilling, producing, distributing, or testing of water resources not related to development of oil, gas and other mineral resources;

          Shoe repairing;

          Storage lockers;

          Telephone answering or paging services;

          Termite or pest control services;

          Tin and sheet metal shops;

          TV cable systems, subscription TV services, and other similar activities;

          Vulcanizing, repairing or recapping of tires or tubes;

          Welding; and

          Woodworking or wood-turning shops.

     Income from services taxed herein performed for electric power associations in the ordinary and necessary operation of their generating or distribution systems shall be taxed at the rate of one percent (1%).

     Income from services taxed herein performed on materials for use in track or track structures to a railroad whose rates are fixed by the Interstate Commerce Commission or the Mississippi Public Service Commission shall be taxed at the rate of three percent (3%).

Income from services performed in connection with geophysical surveying, exploring, developing, drilling, redrilling, completing, working over, producing, distributing, or testing of oil, gas and other mineral resources, including overhead services shall be taxed at the rate of four and one-half percent (4-1/2%).  Operators that rebill services to nonoperating working interest owners on behalf of the joint account through the joint interest billing (JIB), where the sales tax has been paid or accrued by the operator shall not be charged a sales tax on the JIB as services income.

     Income from renting or leasing tangible personal property used within this state shall be taxed at the same rates as sales of the same property.

     Persons doing business in this state who rent transportation equipment with a situs within or without the state to common, contract or private commercial carriers are taxed on that part of the income derived from use within this state.  If specific accounting is impracticable, a formula may be used with approval of the commissioner.

     A lessor may deduct from the tax computed on the rental income from tangible personal property a credit for sales or use tax paid to this state at the time of purchase of the specific personal property being leased or rented until such credit has been exhausted.

     Charges for custom processing and repairing services may be excluded from gross taxable income when the property on which the service was performed is delivered to the customer in another state either by common carrier or in the seller's equipment.

     When a taxpayer performs services covered by this section, which are performed both in intrastate and interstate commerce, the taxpayer may utilize any reasonable formulae of apportionment which will apportion to this state, for taxation, that portion of the services which are performed within the State of Mississippi.

     SECTION 7.  Section 27-65-25, Mississippi Code of 1972, is amended as follows:

     27-65-25.  Upon every person engaging or continuing within this state in the business of selling alcoholic beverages at retail, the sales of which are legal under the provisions of Chapter 1 of Title 67, Mississippi Code of 1972, there is hereby levied, assessed and shall be collected a tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross proceeds of the retail sales of the business.

     SECTION 8.  Section 27-65-26, Mississippi Code of 1972, is amended as follows:

     27-65-26.  (1)  Upon every person engaging or continuing within this state in the business of selling, renting or leasing specified digital products, there shall be levied, assessed and shall be collected a tax equal to seven percent (7%) through June 30, 2026, seven and one-half percent (7.5%) from and after July 1, 2026, through June 30, 2027, and eight percent (8%) from and after July 1, 2027, of the gross income of the business.  The sale of a digital code that allows the purchaser to obtain a specified digital product shall be taxed in the same manner as the sale of a specified digital product.  The tax is imposed when:

          (a)  The sale is to an end user;

          (b)  The seller grants the right of permanent or less than permanent use of the products transferred electronically; or

          (c)  The sale is conditioned or not conditioned upon continued payment.

     (2)  Charges by one (1) specified digital products provider to another specified digital products provider holding a permit issued under Section 27-65-27 for services that are resold by such other specified digital products provider shall not be subject to the tax levied pursuant to this section.

     (3)  For purposes of this section:

          (a)  "Specified digital products" means electronically transferred digital audio-visual works, digital audio works and digital books.

          (b)  "Digital audio-visual works" means a series of related images which, when shown in succession, impart an impression of motion, together with accompanying sounds, if any.

          (c)  "Digital audio works" means works that result from the fixation of a series of musical, spoken or other sounds, including ringtones.  "Ringtones" means digitized sound files that are downloaded onto a device and that may be used to alert the customer with respect to a communication.

          (d)  "Digital books" means works that are generally recognized in the ordinary and usual sense as "books."

          (e)  "Electronically transferred" means obtained by the purchaser by means other than tangible storage media.

          (f)  "End user" means any person other than a person who receives by contract a product transferred electronically for further commercial broadcast, rebroadcast, transmission, retransmission, licensing, relicensing, distribution, redistribution or exhibition of the product, in whole or in part, to another person or persons.

          (g)  "Permanent use" means for purposes of this section for perpetual or for an indefinite or unspecified length of time.

          (h)  "Digital code" means a code that permits a purchaser to obtain a specified digital product at a later date.

     SECTION 9.  Section 27-65-75, Mississippi Code of 1972, is amended as follows:

     27-65-75.  On or before the fifteenth day of each month, the revenue collected under the provisions of this chapter during the preceding month shall be paid and distributed as follows:

     (1)  (a)  On or before August 15, 1992, and each succeeding month thereafter through July 15, 1993, eighteen percent (18%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3) and 27-65-21, on business activities within a municipal corporation shall be allocated for distribution to the municipality and paid to the municipal corporation.  Except as otherwise provided in this paragraph (a), on or before August 15, 1993, and each succeeding month thereafter through August 15, 2026, eighteen and one-half percent (18-1/2%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3), 27-65-21 and 27-65-24, on business activities within a municipal corporation shall be allocated for distribution to the municipality and paid to the municipal corporation.  Except as otherwise provided in this paragraph (a), on or before September 15, 2026, and each succeeding month thereafter, eighteen and one-half percent (18-1/2%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-17(1)(n), 27-65-19(3), 27-65-21 and 27-65-24, on business activities within a municipal corporation shall be allocated for distribution to the municipality and paid to the municipal corporation.  Except as otherwise provided in this paragraph (a), on or before September 15, 2026, and each succeeding month thereafter, twenty-five and nine-tenths percent (25.9%) of the total sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(1)(n) on business activities within a municipal corporation shall be allocated for distribution to the municipality and paid to the municipal corporation.  However, in the event the State Auditor issues a certificate of noncompliance pursuant to Section 21-35-31, the Department of Revenue shall withhold ten percent (10%) of the allocations and payments to the municipality that would otherwise be payable to the municipality under this paragraph (a) until such time that the department receives written notice of the cancellation of a certificate of noncompliance from the State Auditor.

     A municipal corporation, for the purpose of distributing the tax under this subsection, shall mean and include all incorporated cities, towns and villages.

     Monies allocated for distribution and credited to a municipal corporation under this paragraph may be pledged as security for a loan if the distribution received by the municipal corporation is otherwise authorized or required by law to be pledged as security for such a loan.

     In any county having a county seat that is not an incorporated municipality, the distribution provided under this subsection shall be made as though the county seat was an incorporated municipality; however, the distribution to the municipality shall be paid to the county treasury in which the municipality is located, and those funds shall be used for road, bridge and street construction or maintenance in the county.

          (b)  On or before August 15, 2006, and each succeeding month thereafter through August 15, 2026, eighteen and one-half percent (18-1/2%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3) and 27-65-21, on business activities on the campus of a state institution of higher learning or community or junior college whose campus is not located within the corporate limits of a municipality, shall be allocated for distribution to the state institution of higher learning or community or junior college and paid to the state institution of higher learning or community or junior college.  On or before September 15, 2026, and each succeeding month thereafter, eighteen and one-half percent (18-1/2%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-17(1)(n), 27-65-19(3) and 27-65-21, on business activities on the campus of a state institution of higher learning or community or junior college whose campus is not located within the corporate limits of a municipality, shall be allocated for distribution to the state institution of higher learning or community or junior college and paid to the state institution of higher learning or community or junior college.  On or before September 15, 2026, and each succeeding month thereafter, twenty-five and nine-tenths percent (25.9%) of the total sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(1)(n) on business activities on the campus of a state institution of higher learning or community or junior college whose campus is not located within the corporate limits of a municipality, shall be allocated for distribution to the state institution of higher learning or community or junior college and paid to the state institution of higher learning or community or junior college.

          (c)  On or before August 15, 2018, and each succeeding month thereafter until August 14, 2019, two percent (2%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3), 27-65-21 and 27-65-24, on business activities within the corporate limits of the City of Jackson, Mississippi, shall be deposited into the Capitol Complex Improvement District Project Fund created in Section 29-5-215.  On or before August 15, 2019, and each succeeding month thereafter until August 14, 2020, four percent (4%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3), 27-65-21 and 27-65-24, on business activities within the corporate limits of the City of Jackson, Mississippi, shall be deposited into the Capitol Complex Improvement District Project Fund created in Section 29-5-215.  On or before August 15, 2020, and each succeeding month thereafter through July 15, 2023, six percent (6%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3), 27-65-21 and 27-65-24, on business activities within the corporate limits of the City of Jackson, Mississippi, shall be deposited into the Capitol Complex Improvement District Project Fund created in Section 29-5-215.  On or before August 15, 2023, and each succeeding month thereafter through August 15, 2026, nine percent (9%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3), 27-65-21 and 27-65-24, on business activities within the corporate limits of the City of Jackson, Mississippi, shall be deposited into the Capitol Complex Improvement District Project Fund created in Section 29-5-215.  On or before September 15, 2026, and each succeeding month thereafter, nine percent (9%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-17(1)(n), 27-65-19(3), 27-65-21 and 27-65-24, on business activities within the corporate limits of the City of Jackson, Mississippi, shall be deposited into the Capitol Complex Improvement District Project Fund created in Section 29-5-215.  On or before September 15, 2026, and each succeeding month thereafter, twelve and six-tenths percent (12.6%) of the total sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(1)(n) on business activities within the corporate limits of the City of Jackson, Mississippi, shall be deposited into the Capitol Complex Improvement District Project Fund created in Section 29-5-215. 

          (d)  (i)  Except as otherwise provided in this paragraph (d), on or before the fifteenth day of the month that the diversion authorized by this section begins, and each succeeding month thereafter, eighteen and one-half percent (18-1/2%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-19(3) and 27-65-21, on business activities within a redevelopment project area developed under a redevelopment plan adopted under the Tax Increment Financing Act (Section 21-45-1 et seq.) shall be allocated for distribution to the county in which the project area is located if:

                   1.  The county:

                        a.  Borders on the Mississippi Sound and the State of Alabama, or

                        b.  Is Harrison County, Mississippi, and the project area is within a radius of two (2) miles from the intersection of Interstate 10 and Menge Avenue;

                   2.  The county has issued bonds under Section 21-45-9 to finance all or a portion of a redevelopment project in the redevelopment project area;

                   3.  Any debt service for the indebtedness incurred is outstanding; and

                   4.  A development with a value of Ten Million Dollars ($10,000,000.00) or more is, or will be, located in the redevelopment area.

(ii)  For a county that is eligible to receive funds under this paragraph (d), as determined by the Department of Revenue under this paragraph (d), from and after September 15, 2026, and each succeeding month thereafter, eighteen and one-half percent (18-1/2%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-15, 27-65-17(1)(n), 27-65-19(3) and 27-65-21, on business activities within a redevelopment project area developed under a redevelopment plan adopted under the Tax Increment Financing Act (Section 21-45-1 et seq.) shall be allocated for distribution to the county in which the project area is located, and twenty-five and nine-tenths percent (25.9%) of the total sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(1)(n) on business activities within a redevelopment project area developed under a redevelopment plan adopted under the Tax Increment Financing Act (Section 21-45-1 et seq.) shall be allocated for distribution to the county in which the project area is located.

              ( * * *iiiii)  Before any sales tax revenue may be allocated for distribution to a county under this paragraph (d), the county shall certify to the Department of Revenue that the requirements of this paragraph (d) have been met, the amount of bonded indebtedness that has been incurred by the county for the redevelopment project and the expected date the indebtedness incurred by the county will be satisfied.

              ( * * *iiiiv)  The diversion of sales tax revenue authorized by this paragraph (d) shall begin the month following the month in which the Department of Revenue determines that the requirements of this paragraph (d) have been met.  The diversion shall end the month the indebtedness incurred by the county is satisfied.  All revenue received by the county under this paragraph (d) shall be deposited in the fund required to be created in the tax increment financing plan under Section 21-45-11 and be utilized solely to satisfy the indebtedness incurred by the county.

     (2)  On or before September 15, 1987, and each succeeding month thereafter, from the revenue collected under this chapter during the preceding month, One Million One Hundred Twenty-five Thousand Dollars ($1,125,000.00) shall be allocated for distribution to municipal corporations as defined under subsection (1) of this section in the proportion that the number of gallons of gasoline and diesel fuel sold by distributors to consumers and retailers in each such municipality during the preceding fiscal year bears to the total gallons of gasoline and diesel fuel sold by distributors to consumers and retailers in municipalities statewide during the preceding fiscal year.  The Department of Revenue shall require all distributors of gasoline and diesel fuel to report to the department monthly the total number of gallons of gasoline and diesel fuel sold by them to consumers and retailers in each municipality during the preceding month.  The Department of Revenue shall have the authority to promulgate such rules and regulations as is necessary to determine the number of gallons of gasoline and diesel fuel sold by distributors to consumers and retailers in each municipality.  In determining the percentage allocation of funds under this subsection for the fiscal year beginning July 1, 1987, and ending June 30, 1988, the Department of Revenue may consider gallons of gasoline and diesel fuel sold for a period of less than one (1) fiscal year.  For the purposes of this subsection, the term "fiscal year" means the fiscal year beginning July 1 of a year.

     (3)  On or before September 15, 1987, and on or before the fifteenth day of each succeeding month, until the date specified in Section 65-39-35, the proceeds derived from contractors' taxes levied under Section 27-65-21 on contracts for the construction or reconstruction of highways designated under the highway program created under Section 65-3-97 shall, except as otherwise provided in Section 31-17-127, be deposited into the State Treasury to the credit of the State Highway Fund to be used to fund that highway program.  The Mississippi Department of Transportation shall provide to the Department of Revenue such information as is necessary to determine the amount of proceeds to be distributed under this subsection.

     (4)  On or before August 15, 1994, and on or before the fifteenth day of each succeeding month through July 15, 1999, from the proceeds of gasoline, diesel fuel or kerosene taxes as provided in Section 27-5-101(a)(ii)1, Four Million Dollars ($4,000,000.00) shall be deposited in the State Treasury to the credit of a special fund designated as the "State Aid Road Fund," created by Section 65-9-17.  On or before August 15, 1999, and on or before the fifteenth day of each succeeding month, from the total amount of the proceeds of gasoline, diesel fuel or kerosene taxes apportioned by Section 27-5-101(a)(ii)1, Four Million Dollars ($4,000,000.00) or an amount equal to twenty-three and one-fourth percent (23-1/4%) of those funds, whichever is the greater amount, shall be deposited in the State Treasury to the credit of the "State Aid Road Fund," created by Section 65-9-17.  Those funds shall be pledged to pay the principal of and interest on state aid road bonds heretofore issued under Sections 19-9-51 through 19-9-77, in lieu of and in substitution for the funds previously allocated to counties under this section.  Those funds may not be pledged for the payment of any state aid road bonds issued after April 1, 1981; however, this prohibition against the pledging of any such funds for the payment of bonds shall not apply to any bonds for which intent to issue those bonds has been published for the first time, as provided by law before March 29, 1981.  From the amount of taxes paid into the special fund under this subsection and subsection (9) of this section, there shall be first deducted and paid the amount necessary to pay the expenses of the Office of State Aid Road Construction, as authorized by the Legislature for all other general and special fund agencies.  The remainder of the fund shall be allocated monthly to the several counties in accordance with the following formula:

          (a)  One-third (1/3) shall be allocated to all counties in equal shares;

          (b)  One-third (1/3) shall be allocated to counties based on the proportion that the total number of rural road miles in a county bears to the total number of rural road miles in all counties of the state; and

          (c)  One-third (1/3) shall be allocated to counties based on the proportion that the rural population of the county bears to the total rural population in all counties of the state, according to the latest federal decennial census.

     For the purposes of this subsection, the term "gasoline, diesel fuel or kerosene taxes" means such taxes as defined in paragraph (f) of Section 27-5-101.

     The amount of funds allocated to any county under this subsection for any fiscal year after fiscal year 1994 shall not be less than the amount allocated to the county for fiscal year 1994.

     Any reference in the general laws of this state or the Mississippi Code of 1972 to Section 27-5-105 shall mean and be construed to refer and apply to subsection (4) of Section 27-65-75.

     (5)  On or before August 15, 2024, and each succeeding month thereafter, One Million Six Hundred Sixty-six Thousand Six Hundred Sixty-six Dollars ($1,666,666.00) shall be paid into the special fund known as the Education Enhancement Fund created and existing under the provisions of Section 37-61-33.

     (6)  An amount each month beginning August 15, 1983, through November 15, 1986, as specified in Section 6, Chapter 542, Laws of 1983, shall be paid into the special fund known as the Correctional Facilities Construction Fund created in Section 6, Chapter 542, Laws of 1983.

     (7)  On or before August 15, 1992, and each succeeding month thereafter through July 15, 2000, two and two hundred sixty-six one-thousandths percent (2.266%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Section 27-65-17(2), shall be deposited by the department into the School Ad Valorem Tax Reduction Fund created under Section 37-61-35.  On or before August 15, 2000, and each succeeding month thereafter through August 15, 2026, two and two hundred sixty-six one-thousandths percent (2.266%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Section 27-65-17(2), shall be deposited into the School Ad Valorem Tax Reduction Fund created under Section 37-61-35 until such time that the total amount deposited into the fund during a fiscal year equals Forty-two Million Dollars ($42,000,000.00).  Thereafter, the amounts diverted under this subsection (7) during the fiscal year in excess of Forty-two Million Dollars ($42,000,000.00) shall be deposited into the Education Enhancement Fund created under Section 37-61-33 for appropriation by the Legislature as other education needs and shall not be subject to the percentage appropriation requirements set forth in Section 37-61-33.  On or before September 15, 2026, and each succeeding month thereafter, two and two hundred sixty-six one-thousandths percent (2.266%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-17(1)(n) and (2), and three and seventeen one-hundredths percent (3.17%) of the total sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(1)(n) shall be deposited into the School Ad Valorem Tax Reduction Fund created under Section 37-61-35 until such time that the total amount deposited into the fund during a fiscal year equals Forty-two Million Dollars ($42,000,000.00).  Thereafter, the amounts diverted under this subsection (7) during the fiscal year in excess of Forty-two Million Dollars ($42,000,000.00) shall be deposited into the Education Enhancement Fund created under Section 37-61-33 for appropriation by the Legislature as other education needs and shall not be subject to the percentage appropriation requirements set forth in Section 37-61-33.

     (8)  On or before August 15, 1992, and each succeeding month thereafter through August 15, 2026, nine and seventy-three one-thousandths percent (9.073%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Section 27-65-17(2), shall be deposited into the Education Enhancement Fund created under Section 37-61-33.  On or before September 15, 2026, and each succeeding month thereafter, nine and seventy-three one-thousandths percent (9.073%) of the total sales tax revenue collected during the preceding month under the provisions of this chapter, except that collected under the provisions of Sections 27-65-17(1)(n) and (2), shall be deposited into the Education Enhancement Fund created under Section 37-61-33.  On or before September 15, 2026, and each succeeding month thereafter, twelve and seven-tenths percent (12.7%) of the total sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(1)(n) shall be deposited into the Education Enhancement Fund created under Section 37-61-33.

     (9)  On or before August 15, 1994, and each succeeding month thereafter, from the revenue collected under this chapter during the preceding month, Two Hundred Fifty Thousand Dollars ($250,000.00) shall be paid into the State Aid Road Fund.

     (10)  On or before August 15, 1994, and each succeeding month thereafter through August 15, 1995, from the revenue collected under this chapter during the preceding month, Two Million Dollars ($2,000,000.00) shall be deposited into the Motor Vehicle Ad Valorem Tax Reduction Fund established in Section 27-51-105.

     (11)  Notwithstanding any other provision of this section to the contrary, on or before February 15, 1995, and each succeeding month thereafter, the sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(2) and the corresponding levy in Section 27-65-23 on the rental or lease of private carriers of passengers and light carriers of property as defined in Section 27-51-101 shall be deposited, without diversion, into the Motor Vehicle Ad Valorem Tax Reduction Fund established in Section 27-51-105.

     (12)  Notwithstanding any other provision of this section to the contrary, on or before August 15, 1995, and each succeeding month thereafter, the sales tax revenue collected during the preceding month under the provisions of Section 27-65-17(1) on retail sales of private carriers of passengers and light carriers of property, as defined in Section 27-51-101 and the corresponding levy in Section 27-65-23 on the rental or lease of these vehicles, shall be deposited, after diversion, into the Motor Vehicle Ad Valorem Tax Reduction Fund established in Section 27-51-105.

     (13)  On or before July 15, 1994, and on or before the fifteenth day of each succeeding month thereafter, that portion of the avails of the tax imposed in Section 27-65-22 that is derived from activities held on the Mississippi State Fairgrounds Complex shall be paid into a special fund that is created in the State Treasury and shall be expended upon legislative appropriation solely to defray the costs of repairs and renovation at the Trade Mart and Coliseum.

     (14)  On or before August 15, 1998, and each succeeding month thereafter through July 15, 2005, that portion of the avails of the tax imposed in Section 27-65-23 that is derived from sales by cotton compresses or cotton warehouses and that would otherwise be paid into the General Fund shall be deposited in an amount not to exceed Two Million Dollars ($2,000,000.00) into the special fund created under Section 69-37-39.  On or before August 15, 2007, and each succeeding month thereafter through July 15, 2010, that portion of the avails of the tax imposed in Section 27-65-23 that is derived from sales by cotton compresses or cotton warehouses and that would otherwise be paid into the General Fund shall be deposited in an amount not to exceed Two Million Dollars ($2,000,000.00) into the special fund created under Section 69-37-39 until all debts or other obligations incurred by the Certified Cotton Growers Organization under the Mississippi Boll Weevil Management Act before January 1, 2007, are satisfied in full.  On or before August 15, 2010, and each succeeding month thereafter through July 15, 2011, fifty percent (50%) of that portion of the avails of the tax imposed in Section 27-65-23 that is derived from sales by cotton compresses or cotton warehouses and that would otherwise be paid into the General Fund shall be deposited into the special fund created under Section 69-37-39 until such time that the total amount deposited into the fund during a fiscal year equals One Million Dollars ($1,000,000.00).  On or before August 15, 2011, and each succeeding month thereafter, that portion of the avails of the tax imposed in Section 27-65-23 that is derived from sales by cotton compresses or cotton warehouses and that would otherwise be paid into the General Fund shall be deposited into the special fund created under Section 69-37-39 until such time that the total amount deposited into the fund during a fiscal year equals One Million Dollars ($1,000,000.00).

     (15)  Notwithstanding any other provision of this section to the contrary, on or before September 15, 2000, and each succeeding month thereafter, the sales tax revenue collected during the preceding month under the provisions of Section 27-65-19(1)(d)(i)2, and 27-65-19(1)(d)(i)3 shall be deposited, without diversion, into the Telecommunications Ad Valorem Tax Reduction Fund established in Section 27-38-7.

     (16)  (a)  On or before August 15, 2000, and each succeeding month thereafter, the sales tax revenue collected during the preceding month under the provisions of this chapter on the gross proceeds of sales of a project as defined in Section 57-30-1 shall be deposited, after all diversions except the diversion provided for in subsection (1) of this section, into the Sales Tax Incentive Fund created in Section 57-30-3.

          (b)  On or before August 15, 2007, and each succeeding month thereafter, eighty percent (80%) of the sales tax revenue collected during the preceding month under the provisions of this chapter from the operation of a tourism project under the provisions of Sections 57-26-1 through 57-26-5, shall be deposited, after the diversions required in subsections (7) and (8) of this section, into the Tourism Project Sales Tax Incentive Fund created in Section 57-26-3.

     (17)  Notwithstanding any other provision of this section to the contrary, on or before April 15, 2002, and each succeeding month thereafter, the sales tax revenue collected during the preceding month under Section 27-65-23 on sales of parking services of parking garages and lots at airports shall be deposited, without diversion, into the special fund created under Section 27-5-101(d).

     (18)  [Repealed]

     (19)  (a)  On or before August 15, 2005, and each succeeding month thereafter, the sales tax revenue collected during the preceding month under the provisions of this chapter on the gross proceeds of sales of a business enterprise located within a redevelopment project area under the provisions of Sections 57-91-1 through 57-91-11, and the revenue collected on the gross proceeds of sales from sales made to a business enterprise located in a redevelopment project area under the provisions of Sections 57-91-1 through 57-91-11 (provided that such sales made to a business enterprise are made on the premises of the business enterprise), shall, except as otherwise provided in this subsection (19), be deposited, after all diversions, into the Redevelopment Project Incentive Fund as created in Section 57-91-9.

          (b)  For a municipality participating in the Economic Redevelopment Act created in Sections 57-91-1 through 57-91-11, the diversion provided for in subsection (1) of this section attributable to the gross proceeds of sales of a business enterprise located within a redevelopment project area under the provisions of Sections 57-91-1 through 57-91-11, and attributable to the gross proceeds of sales from sales made to a business enterprise located in a redevelopment project area under the provisions of Sections 57-91-1 through 57-91-11 (provided that such sales made to a business enterprise are made on the premises of the business enterprise), shall be deposited into the Redevelopment Project Incentive Fund as created in Section 57-91-9, as follows:

              (i)  For the first six (6) years in which payments are made to a developer from the Redevelopment Project Incentive Fund, one hundred percent (100%) of the diversion shall be deposited into the fund;

              (ii)  For the seventh year in which such payments are made to a developer from the Redevelopment Project Incentive Fund, eighty percent (80%) of the diversion shall be deposited into the fund;

              (iii)  For the eighth year in which such payments are made to a developer from the Redevelopment Project Incentive Fund, seventy percent (70%) of the diversion shall be deposited into the fund;

              (iv)  For the ninth year in which such payments are made to a developer from the Redevelopment Project Incentive Fund, sixty percent (60%) of the diversion shall be deposited into the fund; and

              (v)  For the tenth year in which such payments are made to a developer from the Redevelopment Project Incentive Fund, fifty percent (50%) of the funds shall be deposited into the fund.

     (20)  On or before January 15, 2007, and each succeeding month thereafter, eighty percent (80%) of the sales tax revenue collected during the preceding month under the provisions of this chapter from the operation of a tourism project under the provisions of Sections 57-28-1 through 57-28-5 shall be deposited, after the diversions required in subsections (7) and (8) of this section, into the Tourism Sales Tax Incentive Fund created in Section 57-28-3.

     (21)  (a)  On or before April 15, 2007, and each succeeding month thereafter through June 15, 2013, One Hundred Fifty Thousand Dollars ($150,000.00) of the sales tax revenue collected during the preceding month under the provisions of this chapter shall be deposited into the MMEIA Tax Incentive Fund created in Section 57-101-3.

          (b)  On or before July 15, 2013, and each succeeding month thereafter, One Hundred Fifty Thousand Dollars ($150,000.00) of the sales tax revenue collected during the preceding month under the provisions of this chapter shall be deposited into the Mississippi Development Authority Job Training Grant Fund created in Section 57-1-451.

     (22)  On or before June 1, 2024, and each succeeding month thereafter until December 31, 2057, an amount determined annually by the Mississippi Development Authority of the sales tax revenue collected during the preceding month under the provisions of this chapter shall be deposited into the MMEIA Tax Incentive Fund created in Section 57-125-3.  This amount shall be based on estimated payments due within the upcoming year to construction contractors pursuant to construction contracts subject to the tax imposed by Section 27-65-21 for construction to be performed on the project site of a project defined under Section 57-75-5(f)(xxxiii) for the coming year.

     (23)  Notwithstanding any other provision of this section to the contrary, on or before August 15, 2009, and each succeeding month thereafter, the sales tax revenue collected during the preceding month under the provisions of Section 27-65-201 shall be deposited, without diversion, into the Motor Vehicle Ad Valorem Tax Reduction Fund established in Section 27-51-105.

     (24)  (a)  On or before August 15, 2019, and each month thereafter through July 15, 2020, one percent (1%) of the total sales tax revenue collected during the preceding month from restaurants and hotels shall be allocated for distribution to the Mississippi Development Authority Tourism Advertising Fund established under Section 57-1-64, to be used exclusively for the purpose stated therein.  On or before August 15, 2020, and each month thereafter through July 15, 2021, two percent (2%) of the total sales tax revenue collected during the preceding month from restaurants and hotels shall be allocated for distribution to the Mississippi Development Authority Tourism Advertising Fund established under Section 57-1-64, to be used exclusively for the purpose stated therein.  On or before August 15, 2021, and each month thereafter, three percent (3%) of the total sales tax revenue collected during the preceding month from restaurants and hotels shall be allocated for distribution to the Mississippi Development Authority Tourism Advertising Fund established under Section 57-1-64, to be used exclusively for the purpose stated therein.  The revenue diverted pursuant to this subsection shall not be available for expenditure until February 1, 2020.

          (b)  The Joint Legislative Committee on Performance Evaluation and Expenditure Review (PEER) must provide an annual report to the Legislature indicating the amount of funds deposited into the Mississippi Development Authority Tourism Advertising Fund established under Section 57-1-64, and a detailed record of how the funds are spent.

     (25)  On or before September 15, 2026, and each succeeding month thereafter, Four Million Dollars ($4,000,000.00) of the total sales tax revenue collected during the preceding month under the provisions of this chapter shall deposited, after diversion, into the State Aid Road Fund created in Section 65-9-17.

     (26)  Notwithstanding any other provision of this section to the contrary, on or before September 15, 2026, and each succeeding month thereafter, the total sales tax revenue collected during the preceding month under the provisions of Sections 27-65-17(1)(a), 27-65-19(1)(a)(i) and (d), 27-65-22, 27-65-23, 27-65-25 and 27-65-26, from the amount of the increases to tax rates under such sections as provided in Senate Bill No. 3095, 2025 Regular Session, shall be deposited without diversion, except the diversion required in subsection (1)(a) of this section, into the State Treasury to the credit of the General Fund.  The provisions of this subsection (26) shall supersede and control over any other provisions of this section providing for the distribution of revenue under this section.

     ( * * *2527)  The remainder of the amounts collected under the provisions of this chapter shall be paid into the State Treasury to the credit of the General Fund.

     ( * * *2628)  (a)  It shall be the duty of the municipal officials of any municipality that expands its limits, or of any community that incorporates as a municipality, to notify the commissioner of that action thirty (30) days before the effective date.  Failure to so notify the commissioner shall cause the municipality to forfeit the revenue that it would have been entitled to receive during this period of time when the commissioner had no knowledge of the action.

          (b)  (i)  Except as otherwise provided in subparagraph (ii) of this paragraph, if any funds have been erroneously disbursed to any municipality or any overpayment of tax is recovered by the taxpayer, the commissioner may make correction and adjust the error or overpayment with the municipality by withholding the necessary funds from any later payment to be made to the municipality.

              (ii)  Subject to the provisions of Sections 27-65-51 and 27-65-53, if any funds have been erroneously disbursed to a municipality under subsection (1) of this section for a period of three (3) years or more, the maximum amount that may be recovered or withheld from the municipality is the total amount of funds erroneously disbursed for a period of three (3) years beginning with the date of the first erroneous disbursement.  However, if during such period, a municipality provides written notice to the Department of Revenue indicating the erroneous disbursement of funds, then the maximum amount that may be recovered or withheld from the municipality is the total amount of funds erroneously disbursed for a period of one (1) year beginning with the date of the first erroneous disbursement.

     SECTION 10.  Section 27-55-11, Mississippi Code of 1972, is amended as follows:

     27-55-11.  Any person in business as a distributor of gasoline or who acts as a distributor of gasoline, as defined in this article, shall pay for the privilege of engaging in such business or acting as such distributor an excise tax equal to Eighteen Cents (18¢) per gallon through June 30, 2026, Twenty-three Cents (23¢) per gallon from July 1, 2026, through June 30, 2027, Twenty-eight Cents (28¢) per gallon from July 1, 2027, through June 30, 2028, Thirty-three Cents (33¢) per gallon from July 1, 2028, until the date specified in Section 65-39-35, and Fourteen and Four-tenths Cents (14.4¢) per gallon thereafter, on all gasoline and blend stock stored, sold, distributed, manufactured, refined, distilled, blended or compounded in this state or received in this state for sale, use on the highways, storage, distribution, or for any purpose.

     Any person in business as a distributor of aviation gasoline, or who acts as a distributor of aviation gasoline, shall pay for the privilege of engaging in such business or acting as such distributor an excise tax equal to Six and Four-tenths Cents (6.4¢) per gallon on all aviation gasoline stored, sold, distributed, manufactured, refined, distilled, blended or compounded in this state or received in this state for sale, storage, distribution or for any purpose.

Beginning July 1, 2030, and on July 1 of every other year thereafter, the excise tax rate provided in this section shall be adjusted by the percentage change in the yearly average of the National Highway Construction Cost Index (NHCCI) issued by the U.S. Federal Highway Administration (FHWA) for the most recent twelve-month published period ending December 31, compared to the base year average, which is the average for the twelve-month period ending December 31, 2026, and rounded to the nearest whole cent.  The maximum amount of increase in the excise tax rate shall not exceed One Cent (1¢) per net gallon of gasoline or special fuel and shall take effect every other year.  The Department of Revenue shall notify each terminal supplier, position holder, licensed distributors distributor, and importer of the tax rate adjustment applicable under this paragraph on or before March 1.

     The excise taxes collected under this section shall be paid and distributed in accordance with Section 27-5-101.

     The tax herein imposed and assessed shall be collected and paid to the State of Mississippi but once in respect to any gasoline.  The basis for determining the tax liability shall be the correct invoiced gallons, adjusted to sixty (60) degrees Fahrenheit at the refinery or point of origin of shipment when such shipment is made by tank car or by motor carrier.  The point of origin of shipment of gasoline transported into this state by pipelines shall be deemed to be that point in this state where such gasoline is withdrawn from the pipeline for storage or distribution, and adjustment to sixty (60) degrees Fahrenheit shall there be made.  The basis for determining the tax liability on gasoline shipped into this state in barge cargoes and by pipeline shall be the actual number of gallons adjusted to sixty (60) degrees Fahrenheit unloaded into storage tanks or other containers in this state, such gallonage to be determined by measurement and/or gauge of storage tank or tanks or by any other method authorized by the commission.  The tank or tanks into which barge cargoes of gasoline are discharged, or into which gasoline transported by pipeline is discharged, shall have correct gauge tables listing capacity, such gauge tables to be prepared by some recognized calibrating agency and to be approved by the commission.

     The tax levied herein shall accrue at the time gasoline is withdrawn from a refinery in this state except when withdrawal is by pipeline, barge, ship or vessel.  The refiner shall pay to the commission the tax levied herein when gasoline is sold or delivered to persons who do not hold gasoline distributor permits.  The refiner shall report to the commission all sales and deliveries of gasoline to bonded distributors of gasoline.  The bonded distributor of gasoline who purchases, receives or acquires gasoline from a refinery in this state shall report such gasoline and pay the tax levied herein.

     Gasoline imported by common carrier shall be deemed to be received by the distributor of gasoline, and the tax levied herein shall accrue, when the car or tank truck containing such gasoline is unloaded by the carrier.

     With respect to distributors or other persons who bring, ship, have transported, or have brought into this state gasoline by means other than through a common carrier, the tax accrues and the tax liability attaches on the distributor or other person for each gallon of gasoline brought into the state at the time when and at the point where such gasoline is brought into the state.

     The tax levied herein shall accrue on blend stock at the time it is blended with gasoline.  The blender shall pay to the commission the tax levied herein when blend stock is sold or delivered to persons who do not hold gasoline distributor permits. The blender shall report to the commission all sales and deliveries of blend stock to bonded distributors of gasoline.  The bonded distributor of gasoline who purchases, receives or acquires blend stock from a blender in this state shall report blend stock and pay the tax levied herein.

     SECTION 11.  Section 27-55-519, Mississippi Code of 1972, is amended as follows:

     27-55-519.  (1)  Any person engaged in business as a distributor of special fuel or who acts as a distributor of special fuel, as defined in this article, shall pay for the privilege of engaging in such business or acting as such distributor an excise tax on all special fuel stored, used, sold, distributed, manufactured, refined, distilled, blended or compounded in this state or received in this state for sale, storage, distribution or for any purpose, adjusted to sixty (60) degrees Fahrenheit.

     The excise tax shall become due and payable when:

          (a)  Special fuel is withdrawn from storage at a refinery, marine or pipeline terminal, except when withdrawal is by barge or pipeline.

          (b)  Special fuel imported by a common carrier is unloaded by that carrier unless the special fuel is unloaded directly into the storage tanks of a refinery, marine or pipeline terminal.

          (c)  Special fuel imported by any person other than a common carrier enters the State of Mississippi unless the special fuel is unloaded directly into the storage tanks of a refinery, marine or pipeline terminal.

          (d)  Special fuel is blended in this state unless such blending occurs in a refinery, marine or pipeline terminal.

          (e)  Special fuel is acquired tax free.

     (2)  The special fuel excise tax shall be as follows:

          (a) * * *  Eighteen Cents (18¢) per gallon  On undyed diesel fuel, Eighteen Cents (18¢) per gallon through June 30, 2026, Twenty-three Cents (23¢) per gallon from July 1, 2026, through June 30, 2027, Twenty-eight Cents (28¢) per gallon from July 1, 2027, through June 30, 2028, Thirty-three Cents (33¢) per gallon from July 1, 2028, until the date specified in Section 65-39-35, and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter;

          (b)  Five and Three-fourths Cents (5.75¢) per gallon on all special fuel except undyed diesel fuel and special fuel used as fuels in aircraft; and

          (c)  Five and One-fourth Cents (5.25¢) per gallon on special fuel used as fuel in aircraft.

(3)  Beginning July 1, 2030, and on July 1 of every other year thereafter, the excise tax rate provided in this section shall be adjusted by the percentage change in the yearly average of the National Highway Construction Cost Index (NHCCI) issued by the U.S. Federal Highway Administration (FHWA) for the most recent twelve-month published period ending December 31, compared to the base year average, which is the average for the twelve-month period ending December 31, 2026, and rounded to the nearest whole cent.  The maximum amount of increase in the excise tax rate shall not exceed One Cent (1¢) per net gallon of gasoline or special fuel and shall take effect every other year.  The Department of Revenue shall notify each terminal supplier, position holder, licensed distributors distributor, and importer of the tax rate adjustment applicable under this paragraph on or before March 1.

     SECTION 12.  Section 27-55-521, Mississippi Code of 1972, is amended as follows:

     27-55-521.  (1)  An excise tax at the rate of Eighteen Cents (18¢) per gallon through June 30, 2026, Twenty-three Cents (23¢) per gallon from July 1, 2026, through June 30, 2027, Twenty-eight Cents (28¢) per gallon from July 1, 2027, through June 30, 2028, Thirty-three Cents (33¢) per gallon from July 1, 2028, until the date specified in Section 65-39-35, * * * Mississippi Code of 1972, and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter is levied on any person engaged in business as a distributor of special fuel or who acts as such who sells:

          (a)  Special fuel for use in performing contracts for construction, reconstruction, maintenance or repairs, where such contracts are entered into with the State of Mississippi, any political subdivision of the State of Mississippi, or any department, agency, institution of the State of Mississippi or any political subdivision thereof.

          (b)  Dyed diesel fuel or kerosene to a state or local governmental entity for use on the highways in a motor vehicle.

          (c)  Special fuel for use on the highway.

     (2)  An excise tax at the rate of Eighteen Cents (18¢) per gallon through June 30, 2026, Twenty-three Cents (23¢) per gallon from July 1, 2026, through June 30, 2027, Twenty-eight Cents (28¢) per gallon from July 1, 2027, through June 30, 2028, Thirty-three Cents (33¢) per gallon from July 1, 2028, until the date specified in Section 65-39-35, * * * Mississippi Code of 1972, and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter is levied on any person who:

          (a)  Uses dyed diesel fuel or kerosene in a motor vehicle on the highways of this state in violation of Section 27-55-539.

          (b)  Purchases or acquires undyed diesel fuel or kerosene for nonhighway use and subsequently uses such diesel fuel or kerosene in a motor vehicle on the highways of this state.

          (c)  Purchases or acquires special fuel for use in performing contracts as specified in this section.

(3)  Beginning July 1, 2030, and on July 1 of every other year thereafter, the excise tax rate provided in this section shall be adjusted by the percentage change in the yearly average of the National Highway Construction Cost Index (NHCCI) issued by the U.S. Federal Highway Administration (FHWA) for the most recent twelve-month published period ending December 31, compared to the base year average, which is the average for the twelve-month period ending December 31, 2026, and rounded to the nearest whole cent.  The maximum amount of increase in the excise tax rate shall not exceed One Cent (1¢) per net gallon of gasoline or special fuel and shall take effect every other year.  The Department of Revenue shall notify each terminal supplier, position holder, licensed distributors distributor, and importer of the tax rate adjustment applicable under this paragraph on or before March 1.

     SECTION 13.  Section 27-55-12, Mississippi Code of 1972, is amended as follows:

     27-55-12.  (1)  The United States government, the State of Mississippi, counties, municipalities, school districts and all other political subdivisions of the state, and volunteer fire departments chartered under the laws of the State of Mississippi as nonprofit corporations shall be exempt from excise taxes on gasoline, special fuel and compressed gas as follows:

          (a)  From the excise tax rate in excess of Nine Cents (9¢) per gallon of gasoline and from the excise tax rate in excess of One Cent (1¢) per gallon of aviation gasoline levied under Section 27-55-11, Mississippi Code of 1972, Five and Four-tenths Cents (5.4¢) thereof shall be exempt as provided in Section 27-55-19, Mississippi Code of 1972.

          (b)  From the excise tax rate in excess of Ten Cents (10¢) per gallon of special fuel levied * * * at Eighteen Cents (18¢) per gallon under Sections 27-55-519 and 27-55-521 and subject to reduction on the date specified in Section 65-39-35, Four and Three-fourths Cents (4.75¢) thereof shall be exempt.

          (c)  From the excise tax rate in excess of One Cent (1¢) per gallon of special fuel taxed at Five and Three-fourths Cents (5.75¢) per gallon and from the excise tax rate in excess of One-half Cent (1/2¢) per gallon of special fuel used in aircraft levied under Section 27-55-519, Four and Three-fourths Cents (4.75¢) thereof shall be exempt.

          (d)  From the portion of the excise tax rate on compressed gas used as a motor fuel that exceeds the rate of tax in effect on June 30, 1987, Three Cents (3¢) thereof shall be exempt.

     (2)  The exemption provided in subsection (1) of this section for sales of gasoline, special fuel and compressed gas to volunteer fire departments shall apply only to sales of gasoline, special fuel and compressed gas for use in a vehicle owned by a volunteer fire department and used for department purposes.

     (3)  The exemption provided in subsection (1) of this section for sales of gasoline, special fuel and compressed gas also shall apply to sales of gasoline, special fuel and compressed gas to an  entity described in Section 27-51-41(2)(u) for use in buses and  other motor vehicles that are exempt from ad valorem taxation under Section 27-51-41(2)(u).

     (4)  Any person other than a bonded distributor of gasoline, bonded distributor of special fuel or bonded distributor of compressed gas who sells or delivers any gasoline, special fuel or compressed gas, subject to the exemption set forth in this section, is required to obtain credit for such exemption from a bonded distributor of gasoline, special fuel or compressed gas.

     SECTION 14.  Section 27-55-523, Mississippi Code of 1972, is amended as follows:

     27-55-523.  For the purpose of determining the amount of his liability for the tax imposed by this article, each bonded distributor of special fuel shall, not later than the twentieth day of the month next following the month in which this article becomes effective, and not later than the twentieth day of each month thereafter, file with the department a monthly report which shall include a statement of the number of gallons of special fuel received and sold by such distributor of special fuel within this state during the preceding calendar month, and such other information as may be reasonably necessary for the proper administration of this article.

     At the time of filing each monthly report with the department, a distributor may take a credit for the number of gallons of special fuel that he purchased during the preceding calendar month from a distributor who pays the excise tax imposed by this article on such special fuel.

     At the time of filing each monthly report with the department, each distributor of special fuel shall pay to the department the full amount of the special fuel tax due from such distributor for the preceding calendar month.

     Reports and payments must be filed electronically by the due date in order to be considered timely filed, except when the due date falls on a weekend or holiday, in which case such reports and payments must be filed electronically by the first working day following the due date in order to be considered timely filed.

     The monthly report of the distributor of special fuel shall be prepared and filed with the department on forms prescribed by the department, or the distributor of special fuel may, with the approval of the department, furnish the required information on machine-prepared schedules.  Such monthly reports or schedules shall be signed by the distributor or his duly authorized agent and shall contain a declaration that the statements contained in such report are true and correct and are made under the penalty of perjury.

     When special fuel, which would otherwise be taxable under the provisions of this article, is imported, sold, delivered or exported, under conditions which will exclude such special fuel from the tax levied under this article by reasons of one or more of the exemptions provided in this article, deduction for such exempt special fuel may be taken without prior approval of the department on the monthly report of the bonded distributor of special fuel importing, selling, delivering or exporting such special fuel.  Provided, however, that the department may require proof to be furnished of such deduction for exempt special fuel.

     When the Five and Three-fourths Cents (5.75¢) per gallon tax has accrued or has been paid on special fuel that is taxed * * * at Eighteen Cents (18¢) per gallon under Sections 27-55-519 and 27-55-521 and subject to reduction on the date specified in Section 65-39-35, a deduction of Five and Three-fourths Cents (5.75¢) per gallon may be made.

     SECTION 15.  Section 27-5-101, Mississippi Code of 1972, is amended as follows:

     [With regard to any county which is exempt from the provisions of Section 19-2-3, this section shall read as follows:]

     27-5-101.  Unless otherwise provided in this section, on or before the fifteenth day of each month, all gasoline, diesel fuel or kerosene taxes which are levied under the laws of this state and collected during the previous month shall be paid and apportioned by the * * * State Tax Commission Department of Revenue as follows:

          (a)  (i)  Except as otherwise provided in Section 31-17-127, from the gross amount of gasoline, diesel fuel or kerosene taxes produced by the state, there shall be deducted an amount equal to one-sixth (1/6) of principal and interest certified by the State Treasurer to the * * * State Tax Commission Department of Revenue to be due on the next semiannual bond and interest payment date, as required under the provisions of Chapter 130, Laws of 1938, and subsequent acts authorizing the issuance of bonds payable from gasoline, diesel fuel or kerosene tax revenue on a parity with the bonds issued under authority of said Chapter 130.  The State Treasurer shall certify to the * * * State Tax Commission Department of Revenue on or before the fifteenth day of each month the amount to be paid to the "Highway Bonds Sinking Fund" as provided by said Chapter 130, Laws of 1938, and subsequent acts authorizing the issuance of bonds payable from gasoline, diesel fuel or kerosene tax revenue, on a parity with the bonds issued under authority of said Chapter 130; and the * * * State Tax Commission Department of Revenue shall, on or before the twenty-fifth day of each month, pay into the State Treasury for credit to the "Highway Bonds Sinking Fund" the amount so certified to him by the State Treasurer due to be paid into such fund each month.  The payments to the "Highway Bonds Sinking Fund" shall be made out of gross gasoline, diesel fuel or kerosene tax collections before deductions of any nature are considered; however, such payments shall be deducted from the allocation to the Mississippi Department of Transportation under paragraph (c) of this section.

               (ii)  From collections derived from the portion of the gasoline excise tax that exceeds Seven Cents (7¢) per gallon, from the portion of the tax on aviation gas under Section 27-55-11 that exceeds Six and Four-tenths Cents (6.4¢) per gallon, from the portion of the special fuel tax levied under Sections 27-55-519 and 27-55-521, * * *at Eighteen Cents (18¢) per gallon that exceeds Ten Cents (10¢) per gallon, from the portion of the taxes levied under Section 27-55-519, at Five and Three-fourths Cents (5.75¢) per gallon that exceeds One Cent (1¢) per gallon on special fuel and Five and One-fourth Cents (5.25¢) per gallon on special fuel used as aircraft fuel, from the portion of the excise tax on compressed gas used as a motor fuel that exceeds the rate of tax in effect on June 30, 1987, and from the portion of the gasoline excise tax in excess of Seven Cents (7¢) per gallon and the diesel excise tax in excess of Ten Cents (10¢) per gallon under Section 27-61-5 there shall be deducted:

                   1.  An amount as provided in Section 27-65-75(4) to the credit of a special fund designated as the "Office of State Aid Road Construction."

                   2.  An amount equal to the tax collections derived from Two Cents (2¢) per gallon of the gasoline excise tax for distribution to the State Highway Fund to be used exclusively for the construction, reconstruction and maintenance of highways of the State of Mississippi or the payment of interest and principal on bonds when specifically authorized by the Legislature for that purpose.

                   3.  The balance shall be deposited in the State Treasury to the credit of the State Highway Fund.  However, beginning September 15, 2028, and each succeeding month thereafter, an amount equal to the tax collections derived from One Cent (1¢) per gallon from the gasoline excise tax levied under Section 27-55-11 and One Cent (1¢) per gallon from the special fuel taxes levied under Sections 27-55-519 and 27-55-521 shall be deposited into the Strategic Multi-Modal Investments Fund created in Section 65-1-901, and the balance shall be deposited in the State Treasury to the credit of the State Highway Fund.

          (b)  Subject to the provisions that said basis of distribution shall in nowise affect adversely the amount specifically pledged in paragraph (a) of this section to be paid into the "Highway Bonds Sinking Fund," the following shall be deducted from the amount produced by the state tax on gasoline, diesel fuel or kerosene tax collections, excluding collections derived from the portion of the gasoline excise tax that exceeds Seven Cents (7¢) per gallon, from the portion of the tax on aviation gas under Section 27-55-11 that exceeds Six and Four-tenths Cents (6.4¢) per gallon, from the portion of the special fuel tax levied under Sections 27-55-519 and 27-55-521, at Eighteen Cents (18¢) per gallon that exceeds Ten Cents (10¢) per gallon, from the portion of the taxes levied under Section 27-55-519, at Five and Three-fourths Cents (5.75¢) per gallon that exceeds One Cent (1¢) per gallon on special fuel and Five and One-fourth Cents (5.25¢) per gallon on special fuel used as aircraft fuel, from the portion of the excise tax on compressed gas used as a motor fuel that exceeds the rate of tax in effect on June 30, 1987, and from the portion of the gasoline excise tax in excess of Seven Cents (7¢) per gallon and the diesel excise tax in excess of Ten Cents (10¢) per gallon under Section 27-61-5:

              (i)  Twenty percent (20%) of such amount which shall be earmarked and set aside for the construction, reconstruction and maintenance of the highways and roads of the state, provided that if such twenty percent (20%) should reduce any county to a lesser amount than that received in the fiscal year ending June 30, 1966, then such twenty percent (20%) shall be reduced to a percentage to provide that no county shall receive less than its portion for the fiscal year ending June 30, 1966;

              (ii)  The amount allowed as refund on gasoline or as tax credit on diesel fuel or kerosene used for agricultural, maritime, industrial, domestic, and nonhighway purposes;

              (iii)  Five percent (5%) of such amount shall be paid to the State Highway Fund;

              (iv)  The amount or portion thereof authorized by legislative appropriation to the Fisheries and Wildlife Fund created under Section 59-21-25;

              (v)  The amount for deposit into the special aviation fund under paragraph (d) of this section; and

              (vi)  The remainder shall be divided on a basis of nine-fourteenths (9/14) and five-fourteenths (5/14) (being the same basis as Four and One-half Cents (4-1/2¢) and Two and One-half Cents (2-1/2¢) is to Seven Cents (7¢) on gasoline, and six and forty-three one-hundredths (6.43) and three and fifty-seven one-hundredths (3.57) is to Ten Cents (10¢) on diesel fuel or kerosene).  The amount produced by the nine-fourteenths (9/14) division shall be allocated to the * * * Transportation Department of Transportation and paid into the State Treasury as provided in this section and in Section 27-5-103 and the five-fourteenths (5/14) division shall be returned to the counties of the state on the following basis:

                   1.  In each fiscal year, each county shall be paid each month the same percentage of the monthly total to be distributed as was paid to that county during the same month in the fiscal year which ended April 9, 1960, until the county receives One Hundred Ninety Thousand Dollars ($190,000.00) in such fiscal year, at which time funds shall be distributed under the provisions of paragraph (b)(vi)4 of this section.

                   2.  If after payments in 1 above, any county has not received a total of One Hundred Ninety Thousand Dollars ($190,000.00) at the end of the fiscal year ending June 30, 1961, and each fiscal year thereafter, then any available funds not distributed under 1 above shall be used to bring such county or counties up to One Hundred Ninety Thousand Dollars ($190,000.00) or such funds shall be divided equally among such counties not reaching One Hundred Ninety Thousand Dollars ($190,000.00) if there is not sufficient money to bring all the counties to said One Hundred Ninety Thousand Dollars ($190,000.00).

                   3.  When a county has been paid an amount equal to the total which was paid to the same county during the fiscal year ended April 9, 1960, such county shall receive no further payments during the then current fiscal year until the last month of such current fiscal year, at which time distribution will be made under 2 above, except as set out in 4 below.

                   4.  During the last month of the current fiscal year, should it be determined that there are funds available in excess of the amount distributed for the year under 1 and 2 above, then such excess funds shall be distributed among the various counties as follows:

                        One-third (1/3) of such excess to be divided equally among the counties;

                        One-third (1/3) of such excess to be paid to the counties in the proportion which the population of each county bears to the total population of the state according to the last federal census;

                        One-third (1/3) of such excess to be paid to the counties in the proportion which the number of square miles of each county bears to the total square miles in the state.

                   5.  It is the declared purpose and intent of the Legislature that no county shall be paid less than was paid during the year ended April 9, 1960, unless the amount to be distributed to all counties in any year is less than the amount distributed to all counties during the year ended April 9, 1960.

     The Municipal Aid Fund as established by Section 27-5-103 shall not participate in any portion of any funds allocated to any county hereunder over and above One Hundred Ninety Thousand Dollars ($190,000.00).

     In any county having countywide road or bridge bonds, or supervisors district or district road or bridge bonds outstanding, which exceed, in the aggregate, twelve percent (12%) of the assessed valuation of the taxable property of the county or district, it shall be the duty of the board of supervisors to set aside not less than sixty percent (60%) of such county's share or district's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest on such road or bridge bonds as they mature.

     In any county having such countywide road or bridge bonds or district road or bridge bonds outstanding which exceed, in the aggregate, eight percent (8%) of the assessed valuation of the taxable property of the county, but which do not exceed, in the aggregate, twelve percent (12%) of the assessed valuation of the taxable property of the county, it shall be the duty of the board of supervisors to set aside not less than thirty-five percent (35%) of such county's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest of such road or bridge bonds as they mature.

     In any county having such countywide road or bridge bonds or district road or bridge bonds outstanding which exceed, in the aggregate, five percent (5%) of the assessed valuation of the taxable property of the county, but which do not exceed, in the aggregate, eight percent (8%) of the assessed valuation of the taxable property of the county, it shall be the duty of the board of supervisors to set aside not less than twenty percent (20%) of such county's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest of such road and bridge bonds as they mature.

     In any county having such countywide road or bridge bonds or district road or bridge bonds outstanding which do not exceed, in the aggregate, five percent (5%) of the assessed valuation of the taxable property of the county, it shall be the duty of the board of supervisors to set aside not less than ten percent (10%) of such county's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest on such road or bridge bonds as they mature.

     The portion of any such county's share of the gasoline, diesel fuel or kerosene taxes thus set aside for the payment of the principal and interest of road or bridge bonds, as provided for in this section, shall be used first in paying the currently maturing installments of the principal and interest of such countywide road or bridge bonds, if there be any such countywide road or bridge bonds outstanding, and secondly, in paying the currently maturing installments of principal and interest of district road or bridge bonds outstanding.  It shall be the duty of the board of supervisors to pay bonds and interest maturing in each supervisors district out of the supervisors district's share of the gasoline, diesel fuel or kerosene taxes of such district.

     The remaining portion of such county's share of the gasoline, diesel fuel or kerosene taxes, after setting aside the portion above provided for the payment of the principal and interest of bonds, shall be used in the construction and maintenance of any public highways, bridges, or culverts of the county, including the roads in special or separate road districts, in the discretion of the board of supervisors, or in paying the interest and principal of county road and bridge bonds or district road and bridge bonds, in the discretion of the board of supervisors.

     In any county having no countywide road or bridge bonds or district road or bridge bonds outstanding, all such county's share of the gasoline, diesel fuel or kerosene taxes shall be used in the construction, reconstruction, and maintenance of the public highways, bridges, or culverts of the county as the board of supervisors may determine.

     In every county in which there are county road bonds or seawall or road protection bonds outstanding which were issued for the purpose of building bridges or constructing public roads or seawalls, such funds shall be used in the manner provided by law.

          (c)  From the amount produced by the nine-fourteenths (9/14) division allocated to the * * * Transportation Department of Transportation, there shall be deducted:

              (i)  The amount paid to the State Treasurer for the "Highway Bonds Sinking Fund" under paragraph (a) of this section;

              (ii)  Any amounts due counties in accordance with Section 65-33-45 which have outstanding bonds issued for seawall or road protection purposes, issued under provisions of Chapter 319, Laws of 1924, and amendments thereto;

              (iii)  Except as otherwise provided in Section 31-17-127, the remainder shall be paid by the * * * State Tax Commission Department of Revenue to the State Treasurer on the fifteenth day of each month next succeeding the month in which the gasoline, diesel fuel or kerosene taxes were collected to the credit of the State Highway Fund.

     The funds allocated for the construction, reconstruction, and improvement of state highways, bridges, and culverts, or so much thereof as may be necessary, shall first be used in conjunction with funds supplied by the federal government for such purposes and allocated to the * * * State Transportation Department of Transportation to be expended on the state highway system.  It is specifically provided hereby that the necessary portion of such funds hereinabove allocated to the * * * State Transportation Department of Transportation may be used for the prompt payment of principal and interest on highway bonds heretofore issued, including such bonds issued or to be issued under the provisions of Chapter 312, Laws of 1956, and amendments thereto.

     Nothing contained in this section shall be construed to reduce the amount of such gasoline, diesel fuel or kerosene excise taxes levied by the state, allotted under the provisions of Title 65, Chapter 33, Mississippi Code of 1972, to counties in which there are outstanding bonds issued for seawall or road protection purposes issued under the provisions of Chapter 319, Laws of 1924, and amendments thereto; the amount of said gasoline, diesel fuel or kerosene excise taxes designated in this section for the payment of bonds and interest authorized and issued or to be issued under the provisions of Chapter 130, Laws of 1938, and subsequent acts authorizing the issuance of bonds payable from gasoline, diesel fuel or kerosene tax revenue, shall, in such counties, be considered as being paid "into the State Treasury to the credit of the State Highway Fund" within the meaning of Section 65-33-45 in computing the amount to be paid to such counties under the provisions of said section, and this section shall be administered in connection with Title 65, Chapter 33, Mississippi Code of 1972, and Sections 65-33-45, 65-33-47 and 65-33-49 dealing with seawalls, as if made a part of this section.

          (d)  The proceeds of the Five and One-fourth Cents (5.25¢) of the tax per gallon on oils used as a propellant for jet aircraft engines, and Six and Four-tenths Cents (6.4¢) of the tax per gallon on aviation gasoline and the tax of One Cent (1¢) per gallon for each gallon of gasoline for which a refund has been made pursuant to Section 27-55-23 because such gasoline was used for aviation purposes, shall be paid to the State Treasury into a special fund to be used exclusively, pursuant to legislative appropriation, for the support and development of aeronautics as defined in Section 61-1-3.

          (e)  State highway funds in an amount equal to the difference between Forty-two Million Dollars ($42,000,000.00) and the annual debt service payable on the state's highway revenue refunding bonds, Series 1985, shall be expended for the construction or reconstruction of highways designated under the highway program created under Section 65-3-97.

          (f)  "Gasoline, diesel fuel or kerosene taxes" as used in this section shall be deemed to mean and include state gasoline, diesel fuel or kerosene taxes levied and imposed on distributors of gasoline, diesel fuel or kerosene, and all state excise taxes derived from any fuel used to propel vehicles upon the highways of this state, when levied by any statute.

[With regard to any county which is required to operate on a countywide system of road administration as described in Section 19-2-3, this section shall read as follows:]

     27-5-101.  Unless otherwise provided in this section, on or before the fifteenth day of each month, all gasoline, diesel fuel or kerosene taxes which are levied under the laws of this state and collected during the previous month shall be paid and apportioned by the * * * State Tax Commission Department of Revenue as follows:

          (a)  (i)  Except as otherwise provided in Section 31-17-127, from the gross amount of gasoline, diesel fuel or kerosene taxes produced by the state, there shall be deducted an amount equal to one-sixth (1/6) of principal and interest certified by the State Treasurer to the * * * State Tax Commission Department of Revenue to be due on the next semiannual bond and interest payment date, as required under the provisions of Chapter 130, Laws of 1938, and subsequent acts authorizing the issuance of bonds payable from gasoline, diesel fuel or kerosene tax revenue on a parity with the bonds issued under authority of said Chapter 130.  The State Treasurer shall certify to the * * * State Tax Commission Department of Revenue on or before the fifteenth day of each month the amount to be paid to the "Highway Bonds Sinking Fund" as provided by said Chapter 130, Laws of 1938, and subsequent acts authorizing the issuance of bonds payable from gasoline, diesel fuel or kerosene tax revenue, on a parity with the bonds issued under authority of said Chapter 130; and the * * * State Tax Commission Department of Revenue shall, on or before the twenty-fifth day of each month, pay into the State Treasury for credit to the "Highway Bonds Sinking Fund" the amount so certified to him by the State Treasurer due to be paid into such fund each month.  The payments to the "Highway Bonds Sinking Fund" shall be made out of gross gasoline, diesel fuel or kerosene tax collections before deductions of any nature are considered; however, such payments shall be deducted from the allocation to the * * * Transportation Department of Transportation under paragraph (c) of this section.

              (ii)  From collections derived from the portion of the gasoline excise tax that exceeds Seven Cents (7¢) per gallon, from the portion of the tax on aviation gas under Section 27-55-11 that exceeds Six and Four-tenths Cents (6.4¢) per gallon, from the portion of the special fuel tax levied under Sections 27-55-519 and 27-55-521, * * *at Eighteen Cents (18¢) per gallon that exceeds Ten Cents (10¢) per gallon, from the portion of the taxes levied under Section 27-55-519, at Five and Three-fourths Cents (5.75¢) per gallon that exceeds One Cent (1¢) per gallon on special fuel and Five and One-fourth Cents (5.25¢) per gallon on special fuel used as aircraft fuel, from the portion of the excise tax on compressed gas used as a motor fuel that exceeds the rate of tax in effect on June 30, 1987, and from the portion of the gasoline excise tax in excess of Seven Cents (7¢) per gallon and the diesel excise tax in excess of Ten Cents (10¢) per gallon under Section 27-61-5 there shall be deducted:

                   1.  An amount as provided in Section 27-65-75(4) to the credit of a special fund designated as the "Office of State Aid Road Construction."

                   2.  An amount equal to the tax collections derived from Two Cents (2¢) per gallon of the gasoline excise tax for distribution to the State Highway Fund to be used exclusively for the construction, reconstruction and maintenance of highways of the State of Mississippi or the payment of interest and principal on bonds when specifically authorized by the Legislature for that purpose.

                   3.  The balance shall be deposited in the State Treasury to the credit of the State Highway Fund.  However, beginning September 15, 2028, and each succeeding month thereafter, an amount equal to the tax collections derived from One Cent (1¢) per gallon from the gasoline excise tax levied under Section 27-55-11 and One Cent (1¢) per gallon from the special fuel taxes levied under Sections 27-55-519 and 27-55-521 shall be deposited into the Strategic Multi-Modal Investments Fund created in Section 65-1-901, and the balance shall be deposited in the State Treasury to the credit of the State Highway Fund.

          (b)  Subject to the provisions that said basis of distribution shall in nowise affect adversely the amount specifically pledged in paragraph (a) of this section to be paid into the "Highway Bonds Sinking Fund," the following shall be deducted from the amount produced by the state tax on gasoline, diesel fuel or kerosene tax collections, excluding collections derived from the portion of the gasoline excise tax that exceeds Seven Cents (7¢) per gallon, from the portion of the tax on aviation gas under Section 27-55-11 that exceeds Six and Four-tenths Cents (6.4¢) per gallon, from the portion of the special fuel tax levied under Sections 27-55-519 and 27-55-521, at Eighteen Cents (18¢) per gallon, that exceeds Ten Cents (10¢) per gallon, from the portion of the taxes levied under Section 27-55-519, at Five and Three-fourths Cents (5.75¢) that exceeds One Cent (1¢) per gallon on special fuel and Five and One-fourth Cents (5.25¢) per gallon on special fuel used as aircraft fuel, from the portion of the excise tax on compressed gas used as a motor fuel that exceeds the rate of tax in effect on June 30, 1987, and from the portion of the gasoline excise tax in excess of Seven Cents (7¢) per gallon and the diesel excise tax in excess of Ten Cents (10¢) per gallon under Section 27-61-5:

              (i)  Twenty percent (20%) of such amount which shall be earmarked and set aside for the construction, reconstruction and maintenance of the highways and roads of the state, provided that if such twenty percent (20%) should reduce any county to a lesser amount than that received in the fiscal year ending June 30, 1966, then such twenty percent (20%) shall be reduced to a percentage to provide that no county shall receive less than its portion for the fiscal year ending June 30, 1966;

              (ii)  The amount allowed as refund on gasoline or as tax credit on diesel fuel or kerosene used for agricultural, maritime, industrial, domestic and nonhighway purposes;

              (iii)  Five percent (5%) of such amount shall be paid to the State Highway Fund;

              (iv)  The amount or portion thereof authorized by legislative appropriation to the Fisheries and Wildlife Fund created under Section 59-21-25;

              (v)  The amount for deposit into the special aviation fund under paragraph (d) of this section; and

              (vi)  The remainder shall be divided on a basis of nine-fourteenths (9/14) and five-fourteenths (5/14) (being the same basis as Four and One-half Cents (4-1/2¢) and Two and One-half Cents (2-1/2¢) is to Seven Cents (7¢) on gasoline, and six and forty-three one-hundredths (6.43) and three and fifty-seven one-hundredths (3.57) is to Ten Cents (10¢) on diesel fuel or kerosene).  The amount produced by the nine-fourteenths (9/14) division shall be allocated to the * * * Transportation Department of Transportation and paid into the State Treasury as provided in this section and in Section 27-5-103 and the five-fourteenths (5/14) division shall be returned to the counties of the state on the following basis:

                   1.  In each fiscal year, each county shall be paid each month the same percentage of the monthly total to be distributed as was paid to that county during the same month in the fiscal year which ended April 9, 1960, until the county receives One Hundred Ninety Thousand Dollars ($190,000.00) in such fiscal year, at which time funds shall be distributed under the provisions of paragraph (b)(vi)4 of this section.

                   2.  If after payments in 1 above, any county has not received a total of One Hundred Ninety Thousand Dollars ($190,000.00) at the end of the fiscal year ending June 30, 1961, and each fiscal year thereafter, then any available funds not distributed under 1 above shall be used to bring such county or counties up to One Hundred Ninety Thousand Dollars ($190,000.00) or such funds shall be divided equally among such counties not reaching One Hundred Ninety Thousand Dollars ($190,000.00) if there is not sufficient money to bring all the counties to said One Hundred Ninety Thousand Dollars ($190,000.00).

                   3.  When a county has been paid an amount equal to the total which was paid to the same county during the fiscal year ended April 9, 1960, such county shall receive no further payments during the then current fiscal year until the last month of such current fiscal year, at which time distribution will be made under 2 above, except as set out in 4 below.

                   4.  During the last month of the current fiscal year, should it be determined that there are funds available in excess of the amount distributed for the year under 1 and 2 above, then such excess funds shall be distributed among the various counties as follows:

                        One-third (1/3) of such excess to be divided equally among the counties;

                        One-third (1/3) of such excess to be paid to the counties in the proportion which the population of each county bears to the total population of the state according to the last federal census;

                        One-third (1/3) of such excess to be paid to the counties in the proportion which the number of square miles of each county bears to the total square miles in the state.

                   5.  It is the declared purpose and intent of the Legislature that no county shall be paid less than was paid during the year ended April 9, 1960, unless the amount to be distributed to all counties in any year is less than the amount distributed to all counties during the year ended April 9, 1960.

     The Municipal Aid Fund as established by Section 27-5-103 shall not participate in any portion of any funds allocated to any county hereunder over and above One Hundred Ninety Thousand Dollars ($190,000.00).

     In any county having road or bridge bonds outstanding which exceed, in the aggregate, twelve percent (12%) of the assessed valuation of the taxable property of the county, it shall be the duty of the board of supervisors to set aside not less than sixty percent (60%) of such county's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest on such road or bridge bonds as they mature.

     In any county having such road or bridge bonds outstanding which exceed, in the aggregate, eight percent (8%) of the assessed valuation of the taxable property of the county, but which do not exceed, in the aggregate, twelve percent (12%) of the assessed valuation of the taxable property of the county, it shall be the duty of the board of supervisors to set aside not less than thirty-five percent (35%) of such county's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest of such road or bridge bonds as they mature.

     In any county having such road or bridge bonds outstanding which exceed, in the aggregate, five percent (5%) of the assessed valuation of the taxable property of the county, but which do not exceed, in the aggregate, eight percent (8%) of the assessed valuation of the taxable property of the county, it shall be the duty of the board of supervisors to set aside not less than twenty percent (20%) of such county's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest of such road and bridge bonds as they mature.

     In any county having such road or bridge bonds outstanding which do not exceed, in the aggregate, five percent (5%) of the assessed valuation of the taxable property of the county, it shall be the duty of the board of supervisors to set aside not less than ten percent (10%) of such county's share of the gasoline, diesel fuel or kerosene taxes to be used in paying the principal and interest on such road or bridge bonds as they mature.

     The portion of any such county's share of the gasoline, diesel fuel or kerosene taxes thus set aside for the payment of the principal and interest of road or bridge bonds, as provided for in this section, shall be used in paying the currently maturing installments of the principal and interest of such road or bridge bonds, if there be any such road or bridge bonds outstanding.

     The remaining portion of such county's share of the gasoline, diesel fuel or kerosene taxes, after setting aside the portion above provided for the payment of the principal and interest of bonds, shall be used in the construction and maintenance of any public highways, bridges or culverts of the county, in the discretion of the board of supervisors.

     In any county having no road or bridge bonds outstanding, all such county's share of the gasoline, diesel fuel or kerosene taxes shall be used in the construction, reconstruction and maintenance of the public highways, bridges or culverts of the county, as the board of supervisors may determine.

     In every county in which there are county road bonds or seawall or road protection bonds outstanding which were issued for the purpose of building bridges or constructing public roads or seawalls, such funds shall be used in the manner provided by law.

          (c)  From the amount produced by the nine-fourteenths (9/14) division allocated to the * * * Transportation Department of Transportation, there shall be deducted:

              (i)  The amount paid to the State Treasurer for the "Highway Bonds Sinking Fund" under paragraph (a) of this section;

              (ii)  Any amounts due counties in accordance with Section 65-33-45 which have outstanding bonds issued for seawall or road protection purposes, issued under provisions of Chapter 319, Laws of 1924, and amendments thereto; and

              (iii)  Except as otherwise provided in Section 31-17-127, the remainder shall be paid by the * * * State Tax Commission Department of Revenue to the State Treasurer on the fifteenth day of each month next succeeding the month in which the gasoline, diesel fuel or kerosene taxes were collected to the credit of the State Highway Fund.

     The funds allocated for the construction, reconstruction and improvement of state highways, bridges and culverts, or so much thereof as may be necessary, shall first be used in conjunction with funds supplied by the federal government for such purposes and allocated to the * * * Transportation Department of Transportation to be expended on the state highway system.  It is specifically provided hereby that the necessary portion of such funds hereinabove allocated to the * * * Transportation Department of Transportation may be used for the prompt payment of principal and interest on highway bonds heretofore issued, including such bonds issued or to be issued under the provisions of Chapter 312, Laws of 1956, and amendments thereto.

     Nothing contained in this section shall be construed to reduce the amount of such gasoline, diesel fuel or kerosene excise taxes levied by the state, allotted under the provisions of Title 65, Chapter 33, Mississippi Code of 1972, to counties in which there are outstanding bonds issued for seawall or road protection purposes issued under the provisions of Chapter 319, Laws of 1924, and amendments thereto; the amount of said gasoline, diesel fuel or kerosene excise taxes designated in this section for the payment of bonds and interest authorized and issued or to be issued under the provisions of Chapter 130, Laws of 1938, and subsequent acts authorizing the issuance of bonds payable from gasoline, diesel fuel or kerosene tax revenue, shall, in such counties, be considered as being paid "into the State Treasury to the credit of the State Highway Fund" within the meaning of Section 65-33-45 in computing the amount to be paid to such counties under the provisions of said section, and this section shall be administered in connection with Title 65, Chapter 33, Mississippi Code of 1972, and Sections 65-33-45, 65-33-47 and 65-33-49 dealing with seawalls, as if made a part of this section.

          (d)  The proceeds of the Five and One-fourth Cents (5.25¢) of the tax per gallon on oils used as a propellant for jet aircraft engines, and Six and Four-tenths Cents (6.4¢) of the tax per gallon on aviation gasoline and the tax of One Cent (1¢) per gallon for each gallon of gasoline for which a refund has been made pursuant to Section 27-55-23 because such gasoline was used for aviation purposes, shall be paid to the State Treasury into a special fund to be used exclusively, pursuant to legislative appropriation, for the support and development of aeronautics as defined in Section 61-1-3.

          (e)  State highway funds in an amount equal to the difference between Forty-two Million Dollars ($42,000,000.00) and the annual debt service payable on the state's highway revenue refunding bonds, Series 1985, shall be expended for the construction or reconstruction of highways designated under the highway program created under Section 65-3-97.

          (f)  "Gasoline, diesel fuel or kerosene taxes" as used in this section shall be deemed to mean and include state gasoline, diesel fuel or kerosene taxes levied and imposed on distributors of gasoline, diesel fuel or kerosene, and all state excise taxes derived from any fuel used to propel vehicles upon the highways of this state, when levied by any statute.

     SECTION 16.  Section 27-33-75, Mississippi Code of 1972, is amended as follows:

     27-33-75.  (1)  Qualified homeowners described in subsection (1) of Section 27-33-67 shall be allowed an exemption from ad valorem taxes according to the following table:

     ASSESSED VALUE                                     HOMESTEAD

      OF HOMESTEAD                                      EXEMPTION

 $  1 - $ 150........................................... $  6.00

  151 -   300...........................................   12.00

  301 -   450...........................................   18.00

  451 -   600...........................................   24.00

  601 -   750...........................................   30.00

  751 -   900...........................................   36.00

  901 - 1,050...........................................   42.00

1,051 - 1,200...........................................   48.00

1,201 - 1,350...........................................   54.00

1,351 - 1,500...........................................   60.00

1,501 - 1,650...........................................   66.00

1,651 - 1,800...........................................   72.00

1,801 - 1,950...........................................   78.00

1,951 - 2,100...........................................   84.00

2,101 - 2,250...........................................   90.00

2,251 - 2,400...........................................   96.00

2,401 - 2,550........................................... 102.00

2,551 - 2,700........................................... 108.00

2,701 - 2,850........................................... 114.00

2,851 - 3,000........................................... 120.00

3,001 - 3,150........................................... 126.00

3,151 - 3,300........................................... 132.00

3,301 - 3,450........................................... 138.00

3,451 - 3,600........................................... 144.00

3,601 - 3,750........................................... 150.00

3,751 - 3,900........................................... 156.00

3,901 - 4,050........................................... 162.00

4,051 - 4,200........................................... 168.00

4,201 - 4,350........................................... 174.00

4,351 - 4,500........................................... 180.00

4,501 - 4,650........................................... 186.00

4,651 - 4,800........................................... 192.00

4,801 - 4,950........................................... 198.00

4,951 - 5,100........................................... 204.00

5,101 - 5,250........................................... 210.00

5,251 - 5,400........................................... 216.00

5,401 - 5,550........................................... 222.00

5,551 - 5,700........................................... 228.00

5,701 - 5,850........................................... 234.00

5,851 - 6,000........................................... 240.00

6,001 - 6,150........................................... 246.00

6,151 - 6,300........................................... 252.00

6,301 - 6,450........................................... 258.00

6,451 - 6,600........................................... 264.00

6,601 - 6,750........................................... 270.00

6,751 - 6,900........................................... 276.00

6,901 - 7,050........................................... 282.00

7,051 - 7,200........................................... 288.00

7,201 - 7,350........................................... 294.00

7,351 and above......................................... 300.00

     Assessed values shall be rounded to the next whole dollar (Fifty Cents (50¢) rounded to the next highest dollar) for the purposes of the above table.

     One-half (1/2) of the exemption allowed in the above table shall be from taxes levied for school district purposes and  one-half (1/2) shall be from taxes levied for county general fund purposes.

     (2)  (a)  (i)  Except as otherwise provided in this subsection, qualified homeowners described in subsection (2) of Section 27-33-67 shall be allowed an exemption from all ad valorem taxes on not in excess of Seven Thousand Five Hundred Dollars ($7,500.00) of the assessed value of the homestead property.

(ii)  From and after January 1, 2026, in addition to any other exemption authorized in this section, qualified homeowners described in subsection (2) of Section 27-33-67 shall be allowed an exemption from all ad valorem taxes in the amount of Two Hundred Dollars ($200.00).  Each receipt for ad valorem taxes on homestead property shall clearly indicate that the exemption provided for by this subparagraph (ii) is authorized as a result of legislative action taken during the 2025 Regular Session.

          (b)  From and after January 1, 2015, qualified homeowners described in subsection (2)(a) of Section 27-33-67 and unremarried surviving spouses of such homeowners shall be allowed an exemption from all ad valorem taxes on the assessed value of the homestead property.

          (c)  Except as otherwise provided in this paragraph (c), a qualified homeowner claiming an exemption under paragraph (a) of this subsection shall be allowed an additional exemption from all ad valorem taxes on an amount equal to the difference between (i) the assessed value of the homestead property on January 1, 2018, or January 1 of the first year for which the qualified homeowner claims an exemption for the homestead property under paragraph (a) of this subsection, and (ii) any increase in the assessed value of the homestead property resulting from a subsequent update in valuation of the homestead property that is completed during the time the qualified homeowner owns the property.  In addition, if a subsequent update in valuation of the homestead property that is completed during the time the qualified homeowner owns the property results in the assessed value of the homestead property being less than the assessed value of the property on January 1, 2018, or January 1 of the first year for which the qualified homeowner claims an exemption for the homestead property under paragraph (a) of this subsection, then the exemption authorized under this paragraph (c) shall be on an amount equal to the difference between (i) such lower assessed value and (ii) any increase in the assessed value of the homestead property resulting from a subsequent update in valuation of the homestead property that is completed during the time the qualified homeowner owns the property.  However, except for renovations, expansions, improvements or additions to promote energy efficiency, safety or access to the homestead property, the exemption authorized in this paragraph (c) shall not apply to any portion of increase in the assessed value of the homestead property that is attributable to renovations, expansions or improvements of or additions to the property during such time.  For the purposes of this paragraph (c), an update in valuation of the homestead property occurs when a county has completed an update in the valuation of Class I property, as designated by Section 112, Mississippi Constitution of 1890, in the county according to procedures prescribed by the Department of Revenue and in effect on January 1, 2018, and for which the Department of Revenue has certified that such new valuations have been implemented for the purposes of ad valorem taxation.

          (d)  From and after January 1, 2023, a qualified homeowner who is the unremarried surviving spouse of a member of the United States Armed Forces who was killed or died on active duty, or of a member of a reserve component of the United States Armed Forces or of the National Guard who was killed or died on active duty for training, shall be allowed an exemption from all ad valorem taxes on the assessed value of the homestead property.

          (e)  From and after January 1, 2025, a qualified homeowner who is an American veteran who has been honorably discharged from military service and has reached ninety (90) years of age on or before January 1 of the year for which the exemption is claimed, shall be allowed an exemption from all ad valorem taxes on the assessed value of the homestead property.

     (3)  Except as otherwise provided in this subsection, this section shall apply to exemptions claimed in the 2001 calendar year for which reimbursement is made in the 2002 calendar year and to exemptions claimed for which reimbursement is made in subsequent years.  The exemption provided for in subsection (2)(b) of this section shall apply to exemptions claimed in the 2015 calendar year for which reimbursement is made in the 2016 calendar year and to exemptions claimed for which reimbursement is made in subsequent years.  The exemption provided for in subsection (2)(c) of this section shall apply to exemptions claimed in the 2018 calendar year for which reimbursement is made in the 2019 calendar year and to exemptions claimed for which reimbursement is made in subsequent years.  The exemption provided for in subsection (2)(e) of this section shall apply to exemptions claimed in the 2025 calendar year for which reimbursement is made in the 2026 calendar year and to exemptions claimed for which reimbursement is made in subsequent years.  The exemption provided for in subsection (2)(a)(ii) of this section shall apply to exemptions claimed in the 2026 calendar year for which reimbursement is made in the 2027 calendar year and to exemptions claimed for which reimbursement is made in subsequent years.

     SECTION 17. (1)  (a)  There is created in the State Treasury a special fund to be known as the "2026 Additional Homestead Exemption Reimbursement Fund", into which shall be deposited monies as provided in Section 27-67-31(i) and monies from any other source designated for deposit into such fund.  The monies in the fund shall be used for the purpose of making payments to counties for the reduction in ad valorem tax revenues incurred by local taxing districts in the county as a result of the additional homestead exemption from ad valorem taxes provided for in Section 27-33-75(2)(a)(ii).  For the purposes of this section, the term "local taxing district" means any county, municipality, school district or other local entity that levies an ad valorem tax or for which an ad valorem tax is levied, to fund all or a portion of its budget.

          (b)  The 2026 Additional Homestead Exemption Reimbursement Fund shall be administered by the department, and monies in the fund shall be expended upon appropriation by the Legislature.  Unexpended amounts remaining in the fund at the end of a state fiscal year shall not lapse into the State General Fund, and any interest earned on amounts in the fund shall be deposited to the credit of the fund.

          (c)  The department shall make payments from the 2026 Additional Homestead Exemption Reimbursement Fund to the county tax collectors for distribution to the local taxing districts as reimbursement for ad valorem taxes that are lost as a result of the additional homestead exemption from ad valorem taxes provided for in Section 27-33-75(2)(a)(ii).  The department shall make payments in the manner that it makes other reimbursements for ad valorem tax losses as a result of exemptions under this article. 

     (2)  The department shall have all powers necessary to implement and administer the provisions of this section, and the department shall promulgate rules and regulations, in accordance with the Mississippi Administrative Procedures Law, necessary for the implementation of this section.

     SECTION 18.  Section 27-67-31, Mississippi Code of 1972, is amended as follows:

     27-67-31.  All administrative provisions of the sales tax law, and amendments thereto, including those which fix damages, penalties and interest for failure to comply with the provisions of said sales tax law, and all other requirements and duties imposed upon taxpayer, shall apply to all persons liable for use taxes under the provisions of this article.  The commissioner shall exercise all power and authority and perform all duties with respect to taxpayers under this article as are provided in said sales tax law, except where there is conflict, then the provisions of this article shall control.

     The commissioner may require transportation companies to permit the examination of waybills, freight bills, or other documents covering shipments of tangible personal property into this state.

     On or before the fifteenth day of each month, the amount received from taxes, damages and interest under the provisions of this article during the preceding month shall be paid and distributed as follows:

          (a)  On or before July 15, 1994, through July 15, 2000, and each succeeding month thereafter, two and two hundred sixty-six one-thousandths percent (2.266%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited in the School Ad Valorem Tax Reduction Fund created pursuant to Section 37-61-35.  On or before August 15, 2000, and each succeeding month thereafter, two and two hundred sixty-six one-thousandths percent (2.266%) of the total use tax revenue collected during the preceding month under the provisions of this chapter shall be deposited into the School Ad Valorem Tax Reduction Fund created under Section 37-61-35 until such time that the total amount deposited into the fund during a fiscal year equals Four Million Dollars ($4,000,000.00).  Thereafter, the amounts diverted under this paragraph (a) during the fiscal year in excess of Four Million Dollars ($4,000,000.00) shall be deposited into the Education Enhancement Fund created under Section 37-61-33 for appropriation by the Legislature as other education needs and shall not be subject to the percentage appropriation requirements set forth in Section 37-61-33.

          (b)  On or before July 15, 1994, and each succeeding month thereafter, nine and seventy-three one-thousandths percent (9.073%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the Education Enhancement Fund created pursuant to Section 37-61-33.

          (c)  On or before July 15, 1997, and on or before the fifteenth day of each succeeding month thereafter, the revenue collected under the provisions of this article imposed and levied as a result of Section 27-65-17(2) and the corresponding levy in Section 27-65-23 on the rental or lease of private carriers of passengers and light carriers of property as defined in Section 27-51-101 shall be deposited into the Motor Vehicle Ad Valorem Tax Reduction Fund created pursuant to Section 27-51-105.

          (d)  On or before July 15, 1997, and on or before the fifteenth day of each succeeding month thereafter and after the deposits required by paragraphs (a) and (b) of this section are made, the remaining revenue collected under the provisions of this article imposed and levied as a result of Section 27-65-17(1) and the corresponding levy in Section 27-65-23 on the rental or lease of private carriers of passengers and light carriers of property as defined in Section 27-51-101 shall be deposited into the Motor Vehicle Ad Valorem Tax Reduction Fund created pursuant to Section 27-51-105.

          (e)  On or before August 15, 2019, and each succeeding month thereafter through July 15, 2020, three and three-fourths percent (3-3/4%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(1).  On or before August 15, 2020, and each succeeding month thereafter through July 15, 2021, seven and one-half percent (7-1/2%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(1).  On or before August 15, 2021, and each succeeding month thereafter through July 15, 2022, eleven and one-fourth percent (11-1/4%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(1).  On or before August 15, 2022, and each succeeding month thereafter, fifteen percent (15%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(1).

          (f)  On or before August 15, 2019, and each succeeding month thereafter through July 15, 2020, three and three-fourths percent (3-3/4%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(2).  On or before August 15, 2020, and each succeeding month thereafter through July 15, 2021, seven and one-half percent (7-1/2%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(2).  On or before August 15, 2021, and each succeeding month thereafter through July 15, 2022, eleven and one-fourth percent (11-1/4%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(2).  On or before August 15, 2022, and each succeeding month thereafter, fifteen percent (15%) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the special fund created in Section 27-67-35(2).

          (g)  On or before August 15, 2019, and each succeeding month thereafter through July 15, 2020, Four Hundred Sixteen Thousand Six Hundred Sixty-six Dollars and Sixty-seven Cents ($416,666.67) or one and one-fourth percent (1-1/4%) of the total use tax revenue collected during the preceding month under the provisions of this article, whichever is the greater amount, shall be deposited into the Local System Bridge Replacement and Rehabilitation Fund created in Section 65-37-13.  On or before August 15, 2020, and each succeeding month thereafter through July 15, 2021, Eight Hundred Thirty-three Thousand Three Hundred Thirty-three Dollars and Thirty-four Cents ($833,333.34) or two and one-half percent (2-1/2%) of the total use tax revenue collected during the preceding month under the provisions of this article, whichever is the greater amount, shall be deposited into the Local System Bridge Replacement and Rehabilitation Fund created in Section 65-37-13.  On or before August 15, 2021, and each succeeding month thereafter through July 15, 2022, One Million Two Hundred Fifty Thousand Dollars ($1,250,000.00) or three and three-fourths percent (3-3/4%) of the total use tax revenue collected during the preceding month under the provisions of this article, whichever is the greater amount, shall be deposited into the Local System Bridge Replacement and Rehabilitation Fund created in Section 65-37-13.  On or before August 15, 2022, and each succeeding month thereafter through July 15, 2023, One Million Six Hundred Sixty-six Thousand Six Hundred Sixty-six Dollars and Sixty-seven Cents ($1,666,666.67) or five percent (5%) of the total use tax revenue collected during the preceding month under the provisions of this article, whichever is the greater amount, shall be deposited into the Local System Bridge Replacement and Rehabilitation Fund created in Section 65-37-13.  On or before August 15, 2023, and each succeeding month thereafter, (i) One Million Six Hundred Sixty-six Thousand Six Hundred Sixty-six Dollars and Sixty-seven Cents ($1,666,666.67) or two and one-half percent (2-1/2%) of the total use tax revenue collected during the preceding month under the provisions of this article, whichever is the greater amount, shall be deposited into the Local System Bridge Replacement and Rehabilitation Fund created in Section 65-37-13, and (ii) One Million Six Hundred Sixty-six Thousand Six Hundred Sixty-six Dollars and Sixty-seven Cents ($1,666,666.67) or two and one-half percent (2-1/2%) of the total use tax revenue collected during the preceding month under the provisions of this article, whichever is the greater amount, shall be deposited into the State Aid Road Fund created in Section 65-9-17.  

          (h)  On or before August 15, 2020, and each succeeding month thereafter through July 15, 2022, One Million Dollars ($1,000,000.00) of the total use tax revenue collected during the preceding month under the provisions of this article shall be deposited into the Local System Bridge Replacement and Rehabilitation Fund created in Section 65-37-13.  Amounts deposited into the Local System Bridge Replacement and Rehabilitation Fund under this paragraph (h) shall be in addition to amounts deposited into the fund under paragraph (g) of this section.

(i)  On or before September 15, 2026, and each succeeding month thereafter, the total use tax revenue collected during the preceding month under the provisions of this article as a result of the increases to sales tax rates, as provided in Senate Bill No. 3095, 2025 Regular Session, shall be deposited, without diversion, into the 2026 Additional Homestead Exemption Reimbursement Fund created in Section 17 of this act.

          ( * * *ij)  The remainder of the amount received from taxes, damages and interest under the provisions of this article shall be paid into the General Fund of the State Treasury by the commissioner.

SECTION 19. There is hereby created in the State Treasury a special fund to be designated as the "Budget Stabilization Fund", which shall consist of funds made available by the Legislature in any manner and funds from any other source designated for deposit into such fund.  Unexpended amounts remaining in the fund at the end of a fiscal year shall not lapse into the State General Fund, and any investment earnings or interest earned on amounts in the fund shall be deposited to the credit of the fund.  Monies in the fund shall only be appropriated by the Legislature to further the purposes of this act.

     SECTION 20.  Section 27-115-85, Mississippi Code of 1972, is amended as follows:

     27-115-85.  (1)  Until June 30, * * *2028 2026, net proceeds generated by the Alyce G. Clarke Mississippi Lottery Law, created pursuant to this chapter and deposited into the Lottery Proceeds Fund under Section 27-115-51(2), except as otherwise provided in this section, shall be paid into the State Highway Fund by warrant issued by the State Fiscal Officer upon requisition of the State Transportation Commission as needed to provide funds to repair, renovate and maintain highways and bridges of the state; however, funds paid into the State Highway Fund under this section shall be first used for matching federal funds authorized to the state pursuant to any federal highway infrastructure program implemented after September 1, 2018.  However, all such monies deposited into the Lottery Proceeds Fund over Eighty Million Dollars ($80,000,000.00) in a fiscal year shall be transferred into the Education Enhancement Fund for the purposes of funding the Early Childhood Learning Collaborative, the Classroom Supply Fund and/or other educational purposes.  * * *From and after July 1, 2028, the net proceeds shall be deposited into the Lottery Proceeds Fund and shall be transferred to the State General Fund, except for the amounts over Eighty Million Dollars ($80,000,000.00) which shall continue to be deposited in the Education Enhancement Fund as provided above.

(2)  From and after July 1, 2026, of the net proceeds generated by the Alyce G. Clarke Mississippi Lottery Law, created pursuant to this chapter and deposited into the Lottery Proceeds Fund under Section 27-115-51:  (a) One Hundred Million Dollars ($100,000,000.00) of such net proceeds shall be paid into the Employer's Accumulation Account of the Public Employees' Retirement System created in Section 25-11-123(c) until the funded ratio for the system is eighty percent (80%) at the end of a fiscal year and thereafter, for each month after that fiscal year such net proceeds shall be paid into the State General Fund and (b) all such monies deposited into the Lottery Proceeds Fund over One Hundred Million Dollars ($100,000,000.00) shall be transferred into the Education Enhancement Fund for the purposes of funding the Early Childhood Learning Collaborative, the Classroom Supply Fund and/or other educational purposes.

     SECTION 21.  Section 27-115-51, Mississippi Code of 1972, is brought forward as follows:

     27-115-51.  (1)  (a)  All monies received by the corporation from the sale of lottery tickets and all other sources shall be deposited into a corporate operating account.  Such account shall be established in a custodian financial institution domiciled in the State of Mississippi and insured by the Federal Deposit Insurance Corporation and collateralized as prescribed by Section 27-105-5.  The corporation may use all monies in the corporate operating account for the purposes of paying prizes and the necessary expenses of the corporation and dividends to the state.  The corporation shall estimate and allocate the amount to be paid by the corporation to prizewinners.

          (b)  (i)  The investment of monies in the corporate operating account, other than the amount specifically required for the purchase of securities for payment of deferred prizes, shall be invested in a manner prescribed by the board, consistent with law.  Such securities purchased as investments by the corporation shall be issued in the name of the corporation and shall be kept at a custodian financial institution domiciled in the State of Mississippi insured by the Federal Deposit Insurance Corporation.

              (ii)  The investment of monies in the corporate operating account, other than the amount specifically required for the purchase of securities for deferred prize payments to winners, shall be invested only in securities in a manner prescribed by the board, consistent with law.  Such securities purchased as investments by the corporation shall be issued in the name of the corporation and shall be safe kept at a custodian financial institution domiciled in the State of Mississippi insured by the Federal Deposit Insurance Corporation.

              (iii)  These instruments may be in varying maturities and may be in book-entry form.

              (iv)  For the purpose of deferred prize payments to winners, the corporation shall purchase or invest in only those securities prescribed by the board, consistent with law.

          (c)  Within twenty (20) days following the close of each calendar month, the corporation shall transfer to the Lottery Proceeds Fund in the State Treasury the amount of net proceeds.

          (d)  The apportionment of the total gross revenues accruing from the sale of lottery tickets or shares and from all other sources shall be as follows:

              (i)  The payment of prizes to the holders of winning lottery tickets or shares which in any case shall be no less than fifty percent (50%) of the total gross revenues accruing from the sale of lottery tickets.

              (ii)  The payment of costs incurred in the operation and administration of the lottery, including the expenses of the corporation and the costs resulting from any contract or contracts entered into for promotional, advertising or operational services or for the purchase or lease of lottery equipment and materials, which in no case shall exceed fifteen percent (15%) of the total gross revenues accruing from the sale of lottery tickets.  However, this restriction shall not apply until after the first twelve (12) months of revenue generation.

     (2)  A Lottery Proceeds Fund is hereby established in the State Treasury.  Net proceeds shall be deposited into this fund as provided in subsection (1) of this section.  Monies deposited into the Lottery Proceeds Fund shall be invested by the state in accordance with state investment practices, and all earnings from such investments shall accrue to this account.  No monies shall be allotted or expended from this account unless pursuant to a warrant issued as provided under Section 27-115-85.

     SECTION 22.  On July 1, 2026, the State Treasurer, in conjunction with the State Fiscal Officer, shall transfer the sum of Three Hundred Million Dollars ($300,000,000.00) from the Capital Expense Fund (Fund No. 6447F00000) to the Budget Stabilization Fund created in Section 19 of this act.

     SECTION 23.  Section 17 of this act shall be codified as a new section in Article 1, Chapter 33, Title 27, Mississippi Code of 1972.

     SECTION 24.  Section 2 of this act shall take effect and be in force from and after January 1, 2025, and the remaining sections of this act shall take effect and be in force from and after July 1, 2025.

     Further, amend by striking the title in its entirety and inserting in lieu thereof the following:

     AN ACT TO CREATE THE "HOUSE NO. 1 OF THE 2025 REGULAR SESSION, THE BUILD UP MISSISSIPPI ACT"; TO AMEND SECTION 27-7-5, MISSISSIPPI CODE OF 1972, TO PHASE OUT THE STATE INCOME TAX ON THE TAXABLE INCOME OF INDIVIDUALS; TO AMEND SECTION 27-65-17, MISSISSIPPI CODE OF 1972, TO REDUCE THE SALES TAX RATE ON RETAIL SALES OF FOOD FOR HUMAN CONSUMPTION NOT PURCHASED WITH FOOD STAMPS BUT WHICH WOULD BE EXEMPT FROM SALES TAX IF PURCHASED WITH FOOD STAMPS; TO INCREASE THE SALES TAX RATE ON SALES OF TANGIBLE PERSONAL PROPERTY; TO AMEND SECTION 27-65-19, MISSISSIPPI CODE OF 1972, TO INCREASE THE SALES TAX RATE ON SALES OF UTILITIES AND TELECOMMUNICATIONS SERVICES; TO AMEND SECTION 27-65-22, MISSISSIPPI CODE OF 1972, TO INCREASE THE SALES TAX RATE ON AMUSEMENT AND ENTERTAINMENT ADMISSIONS; TO AMEND SECTION 27-65-23, MISSISSIPPI CODE OF 1972, TO INCREASE THE SALES TAX RATE ON VARIOUS SERVICES; TO AMEND SECTION 27-65-25, MISSISSIPPI CODE OF 1972, TO INCREASE THE SALES TAX RATE ON RETAIL SALES OF ALCOHOLIC BEVERAGES; TO AMEND SECTION 27-65-26, MISSISSIPPI CODE OF 1972, TO INCREASE THE SALES TAX RATE ON THE SALE, RENTING OR LEASING OF SPECIFIED DIGITAL PRODUCTS; TO AMEND SECTION 27-65-75, MISSISSIPPI CODE OF 1972, TO REVISE THE DISTRIBUTION OF STATE SALES TAX REVENUE COLLECTED FROM RETAIL SALES OF FOOD FOR HUMAN CONSUMPTION NOT PURCHASED WITH FOOD STAMPS BUT WHICH WOULD BE EXEMPT FROM SALES TAX IF PURCHASED WITH FOOD STAMPS; TO PROVIDE THAT $4,000,000.00 OF STATE SALES TAX REVENUE SHALL BE DEPOSITED MONTHLY INTO THE STATE AID ROAD FUND; TO PROVIDE FOR THE DISTRIBUTION OF THE STATE SALES REVENUE COLLECTED FROM INCREASES TO SALES TAX RATES UNDER THIS ACT; TO AMEND SECTIONS 27-55-11, 27-55-519 AND 27-55-521, MISSISSIPPI CODE OF 1972, TO INCREASE THE EXCISE TAXES ON GASOLINE AND CERTAIN SPECIAL FUELS; TO PROVIDE FOR THE INDEXING OF SUCH TAXES; TO AMEND SECTIONS 27-55-12 AND 27-55-523, MISSISSIPPI CODE OF 1972, TO CONFORM; TO AMEND SECTION 27-5-101, MISSISSIPPI CODE OF 1972, TO REVISE THE DISTRIBUTION OF REVENUE FROM CERTAIN GASOLINE AND SPECIAL FUEL TAXES; TO AMEND SECTION 27-33-75, MISSISSIPPI CODE OF 1972, TO AUTHORIZE AN ADDITIONAL HOMESTEAD EXEMPTION FROM AD VALOREM TAXES FOR QUALIFIED HOMEOWNERS WHO ARE SIXTY-FIVE YEARS OF AGE OR OLDER OR TOTALLY DISABLED; TO CREATE THE "2026 ADDITIONAL HOMESTEAD EXEMPTION REIMBURSEMENT FUND" AS A SPECIAL FUND IN THE STATE TREASURY; TO PROVIDE THAT THE FUND SHALL BE ADMINISTERED BY THE DEPARTMENT OF REVENUE AND THAT MONIES IN THE FUND SHALL BE USED FOR THE PURPOSE OF MAKING PAYMENTS TO COUNTIES FOR THE REDUCTION IN AD VALOREM TAX REVENUES INCURRED BY LOCAL TAXING DISTRICTS IN COUNTIES AS A RESULT OF THE ADDITIONAL HOMESTEAD EXEMPTION FROM AD VALOREM TAXES AUTHORIZED IN THIS ACT; TO AMEND SECTION 27-67-31, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE STATE USE TAX REVENUE COLLECTED FROM INCREASES TO SALES TAX RATES UNDER THIS ACT SHALL BE DEPOSITED INTO THE 2026 ADDITIONAL HOMESTEAD EXEMPTION REIMBURSEMENT FUND; TO CREATE THE "BUDGET STABILIZATION FUND" AS A SPECIAL FUND IN THE STATE TREASURY; TO PROVIDE THAT MONIES IN THE FUND SHALL BE APPROPRIATED BY THE LEGISLATURE TO FURTHER THE PURPOSES OF THIS ACT; TO AMEND SECTION 27-115-85, MISSISSIPPI CODE OF 1972, TO REVISE THE DISTRIBUTION OF NET PROCEEDS GENERATED BY THE ALYCE G. CLARKE MISSISSIPPI LOTTERY LAW TO PROVIDE THAT $100,000,000.00 OF THE NET PROCEEDS SHALL BE PAID INTO THE EMPLOYER'S ACCUMULATION ACCOUNT OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM UNTIL THE FUNDED RATIO FOR THE SYSTEM IS 80% AT THE END OF A FISCAL YEAR AND THEREAFTER, FOR EACH MONTH AFTER THAT FISCAL YEAR SUCH NET PROCEEDS SHALL BE PAID INTO THE STATE GENERAL FUND AND THAT ALL SUCH MONIES DEPOSITED INTO THE LOTTERY PROCEEDS FUND OVER $100,000,000.00 SHALL BE TRANSFERRED INTO THE EDUCATION ENHANCEMENT FUND FOR THE PURPOSES OF FUNDING THE EARLY CHILDHOOD LEARNING COLLABORATIVE, THE CLASSROOM SUPPLY FUND AND/OR OTHER EDUCATIONAL PURPOSES; TO BRING FORWARD SECTION 27-115-51, MISSISSIPPI CODE OF 1972, WHICH PROVIDES FOR THE DEPOSIT OF MONIES RECEIVED FROM LOTTERY TICKET SALES INTO A CORPORATE OPERATING ACCOUNT AND THE TRANSFER OF NET PROCEEDS FROM THE CORPORATE OPERATING ACCOUNT TO THE LOTTERY PROCEEDS FUND FOR THE PURPOSES OF POSSIBLE AMENDMENT; TO TRANSFER $300,000,000.00 FROM THE CAPITAL EXPENSE FUND TO THE BUDGET STABILIZATION FUND CREATED IN THIS ACT; AND FOR RELATED PURPOSES.

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