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VOL. 128 | NO. 41 | Thursday, February 28, 2013

Mississippi House OKs List of Tax Breaks for Businesses

EMILY WAGSTER PETTUS | Associated Press

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JACKSON, Miss. (AP) – The Mississippi House has approved tens of millions of dollars' worth of tax breaks for businesses, but it's unclear if the proposals will survive the Senate.

A top budget writer, House Appropriations Committee Chairman Herb Frierson, estimated Tuesday that the proposed tax breaks would be worth at least $50 million a year and he said that's a big problem. Frierson, R-Poplarville, said the $5.5 billion state budget is already stretched thin. He said even if legislators spend all the available cash for the fiscal year that starts July 1, they'd still be $172 million short of paying for critical needs. Taking out another $50 million would put the shortage at $222 million.

The House needs to learn to say no to groups that want something, whether it's more state funding or a lower tax bill, Frierson said.

"There's consequences in politics. You can't be a narcissistic populist," he told reporters after the House passed several bills Tuesday. "Populism is wrong, whether it's liberal or conservative."

But Ways and Means Committee Chairman Jeff Smith, R-Columbus, said he's not trying to deplete the state coffers by pushing for tax breaks. He said that when businesses get incentives, they create jobs, the economy expands and the state collects more revenue.

"Do you think that when we take something out of the general fund we're not expecting to get something back?" Smith told the House. "Come on, folks. Y'all are good business people."

Smith said the Senate rejected several tax incentives that the House passed in 2012. One of the few that passed both chambers and was signed into law last year was an inventory tax break that was "as weak as a popcorn poot," Smith said.

The House had passed several tax-break bills earlier this session, including sales tax incentives for hotel renovations and income tax credits for those who employ veterans.

The bills that passed Tuesday were:

– House Bill 1679, to give licensed builders or remodelers a sales tax exemption for concrete and asphalt for use in residential construction.

– House Bill 1594, to give a property tax exemption for pollution control equipment mandated by federal law.

– House Bill 1621, to give sales tax and property tax exemptions for equipment used to deploy broadband technology.

– House Bill 566, to authorize an income tax credit for a business to relocate to Mississippi or to expand in the state.

– House Bill 1680, which would define some scrap-metal recycling activities as manufacturing, which could lead to tax breaks for businesses.

– House Bill 1591, sponsored by Frierson, which would allow refundable income and franchise tax credits for the costs of buying and installing solar energy systems or energy efficiency services.

The bill won an unusual cross-section of support from lawmakers who often find themselves on opposite sides of issues, including Republican Rep. Mark Formby, of Picayune, and Democratic Rep. David Baria, of Bay St. Louis.

– House Bill 992, which says any newly licensed physician or nurse practitioner who sets up practice in a medically underserved area would not have to pay income tax on earnings above $100,000 a year. Republican Gov. Phil Bryant proposed this as an incentive to lure medical professionals to rural areas.

Rep. Steve Holland, D-Plantersville, said nurse practitioners are the main health care providers in small towns because physicians can make more money in bigger cities.

"The raw fact of the matter is, doctors don't want to practice in rural Mississippi," said Holland, who voted against the bill. "I am not opposed to doctors, but we're whistling 'Dixie' is what we're doing with this bill."

Follow Emily Wagster Pettus on Twitter: www.twitter.com/EWagsterPettus

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 72 368 16,413
MORTGAGES 66 422 21,432
FORECLOSURE NOTICES 15 76 4,266
BUILDING PERMITS 176 877 39,378
BANKRUPTCIES 60 294 15,542
BUSINESS LICENSES 20 98 5,491
UTILITY CONNECTIONS 69 423 23,573
MARRIAGE LICENSES 17 95 5,035

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