House and Senate negotiations over proposals to drastically overhaul Mississippi’s tax code appear to be at a standstill as lawmakers weigh the impact federal spending cuts could have on one of the nation’s poorest and most federally-dependent states. 

With only weeks left in the 2025 session, lawmakers are pushing different proposals behind the scenes to see if Mississippi can pull off an experiment that no other state has accomplished: Eliminating an income tax after having it on the books for more than a century.

The negotiations, which House Speaker Jason White said “appeared to have stalled” last week, are unfolding as the Trump administration and Republican-controlled Congress are floating massive spending cuts. Mississippi relies on the federal government for revenue more than almost any other state, with more than 40% of its annual budget coming from federal dollars. Deep federal spending cuts alongside the elimination or drastic reduction of the state income tax could reduce Mississippi’s ability to fund services, experts told Mississippi Today.  

The House leadership, early in the session, advanced a proposal that would eliminate the income tax over the next decade, trim the state’s grocery tax, raise sales taxes and add a new sales tax on gasoline. 

Weeks later, the Senate passed a less ambitious tax plan that cuts the income tax, raises the gasoline tax over several years and trims the grocery tax. The plan does not fully eliminate the income tax, which the House leadership and Republican Gov. Tate Reeves say is their main focus. 

Proponents of eliminating the income tax say doing so would unleash economic growth by attracting corporate investment and new residents fleeing higher-tax states. Such growth would offset potential revenue losses in a state that has enjoyed a budget surplus in recent years, they argue.

Economists, however, are divided on whether such growth would blunt the impact of potential budget shortfalls in a poverty-stricken state.

Neva Butkus, a senior analyst at the Institute on Taxation and Economic Policy, published an analysis late last month on the tax proposals moving through each chamber. The organization’s modeling estimates the Senate plan would result in $876 million in lost revenue. The House plan would reduce state revenues by $2.1 billion compared to taxes today – a 30 percent reduction of the state’s current general fund, the organization projected. These numbers are for the state general fund and do not deduct the tax increases in the respective plans that would generate revenue for roads and local governments.

“At a time when states across the country are forecasting deficits or anticipating slowing revenue growth, Mississippi lawmakers are debating deeply regressive and expensive tax cuts that would overwhelmingly benefit their state’s richest residents,” Butkus wrote. “Cutting revenues while shifting taxes away from the state’s richest residents to low- and moderate-income families who already struggle to make ends meet is shortsighted.”

Republican House Speaker Jason White, one of the loudest voices calling for income tax elimination, said the federal cuts floated by national Republicans thus far haven’t convinced him legislators should hold off on approving new tax cuts. 

He told reporters this week that House leaders have continued to meet with Senate officials to work out a deal. He remains flexible on what a final proposal could include, but remains committed to finding a path to complete elimination of the income tax, instead of just a cut. 

“The Senate has kicked around this idea that they might entertain total elimination, but over a very long period of time,” White said. “We’re trying to see exactly what that looks like, should it involve (revenue growth) triggers. We would be open to triggers … For us, if we’re going to go that far on some of these issues, we would want to include total elimination.”

White and other proponents of income tax elimination view the income tax as an unfair burden on working people. Nine other states — including nearby Florida, Texas and Tennessee — don’t have a state income tax. Proponents of elimination argue that Mississippi is at a competitive disadvantage.

Leaders of the 52-member Senate have been tighter-lipped, but they’ll likely meet before a key Tuesday deadline to either offer their original tax cut plan again or advance a new proposal for the House to consider. 

Senate Finance Chairman Josh Harkins, the chamber’s lead negotiator, told Mississippi Today that the Senate wants to cut taxes but would only agree to a plan that won’t drain state coffers.

And the Flowood Republican says his Senate colleagues are deeply concerned that the tens of billions the state receives from the federal government every year could be frozen or reduced by the spending cuts congressional Republicans and President Donald Trump are considering.

“Any cuts that the federal government is contemplating are going to trickle down at some level, and it’s going to impact us,” Harkins said. 

House and Senate leaders both want tax cut legislation to be paired with a plan to ensure the state’s employee retirement system, which has debt of roughly $25 billion, remains solvent for the long term. But they haven’t reached consensus on how to do that.  

An unknown variable in the legislative equation is what Republican Gov. Tate Reeves is willing to do to achieve his stated goal of eliminating the income tax. 

In social media posts, Reeves has repeated his support for total elimination of the income tax, and dared the Senate, which is led by Lt. Gov. Delbert Hosemann, to oppose the policy. But the second-term governor has offered no plan of his own this year and has largely been absent from the Capitol during the debate. If the two chambers cannot agree on a final plan, he could call them into a special session and use his bully pulpit to try to force a compromise. 

READ MORE: ‘Not COVID. It’s Trump’: Lawmakers prepare for tumultuous Trumpenomics by … upending state tax structure

While the state’s top politicians debate whether Mississippi, a state that has failed to fix its high poverty rate and whose agencies continue to deal with costly lawsuits and federal investigations, national experts have cautioned that drastic tax cuts alongside a reduction in federal funding could cripple the state economy if lawmakers aren’t prudent. 

Justin Theal, senior officer at The Pew Charitable Trusts, said across the country state budget stresses are more widespread than they have been at any time since at least the COVID-19 pandemic struck in 2020, before any federal cuts were on the table.

This trajectory means legislators will need to consider how changes at both the state and federal levels could put state revenues at risk of chronically falling short of ongoing spending, Theal added.

“Federal spending cuts could ripple through Mississippi’s broader economy, particularly in sectors that depend on federal funding, contracts, or employees,” Theal said. “This could, in turn, increase demand for public services at a time when budget flexibility is already tightening.”

States that have a smaller tax bases stand to bear the brunt of slashed revenues and cuts to federal programs, said Lucy Dadayan, principal research associate with the Urban-Brookings Tax Policy Center.

“The uncertainty is even bigger for states like Mississippi, Louisiana, Alabama and other states that have high reliance on federal funding and low fiscal capacity.” 

In late February, the Republican-controlled U.S. House passed a GOP budget blueprint with $4.5 trillion in tax breaks and $2 trillion in spending cuts despite fierce opposition from Democrats and discomfort among some Republicans.

A significant chunk of the federal budget is spent on health care, food stamps, student loans and other social service programs, which Democrats and even some Republicans worry could be on the chopping block. The implications could be dire for a poor state like Mississippi, some fear.  

“While other states are preserving revenues in anticipation of reductions to federal dollars that help deliver programs like SNAP, Medicaid, and education resources, Mississippi lawmakers are instead considering costly and regressive tax cuts,”  Butkus wrote.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

A bill that would make it easier for K-12 students to transfer to other public schools outside their home districts, one of the last “school choice” measures to remain alive this session, died in the House this week.

That came after Senate leaders said House legislation easing public-to-public transfers, or “portability,” did not have the votes to pass that chamber.

The House initially responded to the Senate with a list ditch attempt to keep the measure alive by inserting language from the legislation into an unrelated bill. But Rep. Jansen Owen, the bill’s sponsor, said he knew the move would be challenged with a parliamentary point of order. Owen said opposition to portability, which he called the most basic of school choice measures, was rooted in outdated arguments.

“The opposition, they were citing things like the change in school culture and property values, which sounds a lot like the 1960s segregationist movement,” Owen said. “The only thing we were doing here was telling the school district they can’t tell me ‘no’ when I want to send my kid to another public school district. But that’s too much for Nancy Loome.”

Nancy Loome, director of the public education advocacy group, The Parents Campaign, said the measure would have harmed public school students because transportation was not provided. Few children would have real “choice,” and many would be left in schools with further reduced resources, Loome argued.

Republican House Speaker Jason White has been angered by the Senate killing most of the House’s education agenda this session, and has criticized fellow Republican Lt. Gov. Delbert Hosemann, who oversees the Senate.

“No need to send a milquetoast, very lame Senate Education agenda back to the House, it’s not even worthy of discussion,” White said in a social media post responding to a Magnolia Tribune report. “… We showed the Senate what Mississippi’s education future looks like with the House bills, and they wholeheartedly rejected them without so much as a whisper. Mississippians are beginning to take notice of the Lt. Governor and his Senate leaders doing the bidding of the status quo.”

Bills remain alive this session that would increase tax credits available to private schools through the Children’s Promise Act.

White vowed to try other measures again next year.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

Early education expert: It’s time to provide paid family leave to help protect babies

by Biz Harris, Mississippi Today
March 14, 2025

Editor’s note: This essay is part of Mississippi Today Ideas, a new platform for thoughtful Mississippians to share fact-based ideas about our state’s past, present and future. You can read more about the section here.

Mississippi leaders say they are taking steps to protect the lives of our babies. One way they can do that is by ensuring they get a healthy, strong start.

About 100 babies are born in Mississippi each day — about one per county. Each of these new lives is full of potential and as a state we have a responsibility to support them during this crucial stage. From the very beginning, early relationships with parents and caregivers shape brain connections that lay the foundation for lifelong learning and relationships.

Given the importance of this window of time, it is exciting that the Mississippi Legislature has passed a bill that is pending the signature of Gov. Tate Reeves to provide six weeks of paid leave to state employees who are primary caregivers of newborns or adopted children. While research shows that at least eight weeks of paid leave for new or adoptive parents can strengthen babies’ brain development, reduce infant mortality, and improve overall child health outcomes, six weeks will still be beneficial. Additionally, any amount of leave can ease the burden on the child care system while also enhancing employee retention and productivity. By allowing families to spend time with their newborns during this pivotal time, Mississippi can create lasting benefits for both children and the workforce.

I was fortunate to have eight weeks of paid leave with my children, followed by an additional month at half pay. This time together was invaluable for my children’s  development, school readiness and overall health. Today, they are thriving– emotionally stable, socially engaged and eager learners in first and fifth grade.

However, not all children receive this time with and support from a parent or caregiver. In Mississippi, only 20% of workers have access to paid leave, and many mothers return to work just two weeks after giving birth.

This early separation can take a serious toll since the first eight weeks of life are a crucial period for brain growth and bonding. By two weeks, babies recognize their parents’ voices; by five weeks, they respond to faces with excitement; and by eight weeks, they find comfort in familiar caregivers. These early interactions lay the foundation for lifelong emotional and cognitive development, making paid leave not just a benefit, but a necessity for families and the future of our children.

Paid leave is more than just a brain-boosting tool—it’s a proven way to save infant lives. In 2024, Mississippi ranked last nationally in infant mortality, highlighting an urgent need for solutions. Research shows that 10 weeks of paid maternity leave is linked to about a 10% reduction in neonatal, infant and under-5 mortality.

Paid leave gives parents the time to attend critical medical appointments, receive guidance from doctors on how to care for and protect their babies, ensure proper vaccinations, and respond to health concerns before they become life-threatening. By providing paid leave, Mississippi can take a crucial step toward improving infant survival rates.

I believe that any amount of paid leave is valuable for children, but at least eight weeks of leave ensures that our babies remain safe and healthy when parents return to work. The CDC recommends that infants get most of their necessary vaccines at eight weeks–not before – and without these vaccinations they are not able to attend child care programs since they are susceptible to dangerous diseases. Without any paid leave, however, many parents must choose between caring for and protecting  their newborn’s health and avoiding financial hardship—a choice no parent should have to make.

Paid leave can also assist with Mississippi’s critical child care shortage. Many mothers struggle to find available infant care, forcing them to reduce work hours or leave their jobs entirely. According to Mississippi State University’s Systems Change Lab, in 2023 there were only enough child care slots for about two-thirds of Mississippi children. Infant care, the most limited and expensive form of care, is particularly scarce.

Paid leave alleviates pressure on the child care system by reducing immediate demand for infant slots and allowing families time to secure the best arrangements for their needs.

My own experience with paid leave allowed me to care for my newborns, ensure they received necessary vaccinations, and transition them into child care so I could return to work. Without this opportunity, I might have had to leave a job I loved, costing my employer money to recruit and train my replacement. Instead, I was able to return and contribute to my team. By offering paid leave to state employees, the state can retain new parents and save these same costs.

By offering paid leave, we can protect our state’s babies while also saving money and boosting efficiency by retaining state employees. More importantly, we can allow families to care for their newborns in ways that lay a strong foundation for their future– building their brains, supporting their health, and encouraging wellbeing—without jeopardizing their livelihoods.

Now is the time for the state to make this commitment for the sake of Mississippi and our babies.

Biz Harris is the executive director of the Mississippi Early Learning Alliance. She is also an alumna of Teach for America’s Mississippi Delta Region where she began her career in education as a teacher in Marks.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.