The week of March 17 in the Mississippi Legislature dawned with a continuing tax standoff between the state House and Senate as they entered the final weeks of a three-month legislative session.
The two chambers remained so far apart with their tax plans that lawmakers and politicos expected the governor would have to force them into special session for more negotiations or else they would leave with no tax plan — heck, maybe even with no state budget.
Speaker Jason White and his GOP House leadership were steadfast in their yearslong desire to relatively quickly eliminate the state income tax and increase the state’s sales and gasoline taxes. This shift to more regressive taxation would stand to strip more than $2 billion from the $7 billion general fund of America’s poorest state, hitting lower-income people hardest and generally helping the more affluent.
Mississippi would, under this House proposal, become the first state to eliminate an existing income tax in American history. But House leaders promise the experiment will lead Mississippi to beulah land and generate more than enough economic growth to cover the billions cut from income tax revenue.
But on the other side of the Capitol, Lt. Gov. Delbert Hosemann and his GOP Senate leadership were standing firm that this House proposal is foolhardy, particularly with massive federal spending cuts and economic uncertainty looming. Mississippi is perennially dependent on money from Washington, and no one can confidently say they know what the coming months from the new Trump administration will mean for the state.
Senate leaders had instead offered only another cut to the state’s income tax, which is already among the lowest in the nation, rather than a total elimination the House was proposing. It was also pretty clear they’d be OK with ending this 2025 legislative session with no major tax changes at all if the House didn’t rein it in.
The stakes on this disagreement between the House and Senate are high for Mississippians for generations to come.
A wide gulf between House and Senate
Both the House and Senate, in their respective plans, had proposed gasoline tax increases to fund badly needed roadwork. But they differed vastly on the amount and means. The House also wanted a sales tax increase, but the Senate was firm against that. Both agreed to slightly trim the sales tax on some groceries.
The tax fight between the Republican-controlled House and Republican-controlled Senate had been ongoing for several years, and Hosemann and the Senate thwarted a previous elimination proposal, instead agreeing to only a tax cut (even as other cuts passed years ago are still being phased in).
Republican Gov. Tate Reeves, from the sidelines, had joined the House leadership call for eliminating the income tax. But to date, at least publicly, he’d followed his usual M.O.: sit back, present no real specific plan of his own or mediate, lob a few social media bombs (mostly at Hosemann and the Senate) and let his fellow-Republican House and Senate leaders fight it out.
Reeves, who has served in prominent political positions since 2003, has never been a consensus builder, noting in the past that, “I don’t mind telling my friends no,” and most typically sitting back, waiting to see how things shake out. Then he either takes credit for or casts blame for the result, depending on how the political winds are blowing.
Although they are all Republicans, Mississippi’s top political leaders have not gotten along very well in recent years. This was the undercurrent of the recent infighting over whether to eliminate the state income tax.
After little progress between House and Senate, battle lines are drawn
Each chamber on Monday passed a counter-offer — voting to amend each others’ bills with their own differing versions and send them back to the opposite chambers. They remained dramatically far apart from.
The Senate passed a proposal that could, eventually, eliminate the state income tax. But it would do so at best very slowly, with economic growth “triggers” built in. They would ensure the income tax would be phased out only if very rosy economic growth projections were met and spending was kept lower.
House leaders, in turn, railed that the Senate’s counter might never really do away with the state income tax. At best, they argued, it could take decades under the Senate plan. The House plan, though, would eliminate it in a little more than a decade.
The House then passed a counter proposal that would increase the gasoline tax by 15 cents a gallon, closer to the Senate’s proposal of 9 cents a gallon. Both would have future gas tax increases kick in automatically after a few years, based on construction costs.
The House had proposed increasing the state sales tax from 7% to 8.5%. In its counter, it dropped it to 8%, although it also now proposed raising the online sales tax from 7% to 8%.
Overall, it appeared early this week that little progress had been made between the two sides and that any agreement, if it came at all, would be at the end of the session, which is expected to come at the end of the month or first week of April — and only after much haggling.
In the Senate, Hosemann had only managed to get his counterproposal passed with the help of four Democrats. A handful of his Republican caucus voted against it or just voted “present,” primarily because it included a gasoline tax increase (which, in the past, Gov. Reeves has also vehemently opposed). The Democrats crossed over and helped pass it for the same reason — they want a gas tax increase to pay for fixing the state’s crumbling roads and bridges.
At the beginning of the week, it appeared that Hosemann and the Senate had moved as far towards the House proposal as they realistically could. The Senate Republicans opposed to the Senate plan would likely not go for the House’s larger gas tax increase and sales tax increase. The crossover Senate Democrats would likely balk at the House’s sales tax increase and more aggressive schedule for income tax elimination.
And it wasn’t likely that Reeves, generally a political foe of his fellow Republican Hosemann, would help sway any of the opposition Senate Republicans to help Hosemann make future parlays.
Each chamber now had its own bill back, but with its language stripped out and the other’s replacing it. With no agreement reached, it was expected each chamber would vote to “invite conference,” go into more intense negotiations in the final days of the session with a handful of lawmakers from each side.
And it looked like, shy of the House caving in on several major points, a deal was unlikely. The realpolitik appeared that Hosemann couldn’t get the Senate to go further even if he wanted it to.
House shocks, agrees to Senate version
On Thursday morning, the House was set to take up its bill — now containing the Senate’s language. Given the vast disagreement between the two chambers, the House was expected to invite conference to move it into the end-game haggling. Few political observers were paying attention to the House floor proceedings on Thursday morning, expecting a quick pro forma vote to invite conference.
But House Ways and Means Chairman Trey Lamar, a lead architect of the House tax plan, instead moved for the House to concur with the Senate. A vote to concur would send the bill on to Gov. Reeves, who could sign it into law.
“Let’s end the tax on work once and for all in the state of Mississippi,” Lamar told the House floor Thursday morning.
This sent media, lobbyists and many lawmakers scurrying back onto the House floor.
After relatively brief debate, with only House Democrats speaking against it, the House passed the bill 92-27, with some Democrats crossing over to vote for it.
Oddly, a member of the House GOP leadership then held the bill on a procedural motion, which could allow for reconsideration or more debate. Also odd, after the House passed the measure, the top legislative leaders on both sides of the building and the governor went quiet and declined to comment.
Reeves, who was standing at a podium with a mic surrounded by Nissan workers in the Capitol Rotunda as the bill passed, refused comment — very odd considering legislation he has called his No. 1 priority had just passed.
Some time later that day, Mississippi Today first reported there were problems with the bill: typos in the Senate’s growth trigger safeguards language.
Typos, not negotiation and agreement, led to income tax elimination
In the end, it wasn’t earnest negotiation or any agreement between the two sides that led to the passage of total income tax elimination in Mississippi — it was a few typos.
The Senate had accidentally put in some decimal points that essentially eliminated the growth triggers that would have staved off full elimination of the income tax for years.
For instance, a passage meant to require growth of 85% of the cost of an income tax cut minus any state spending increases instead said .85%. This means that instead of hundreds of millions of dollars in revenue growth spurring a tax cut in any year, just a few million dollars a year will result in massive tax cuts.
Instead of a long, cautious phase out of the income tax, the Senate had inadvertently approved a phase-out that would happen about as quickly as the House’s plan, and without any real growth triggers as safeguards. Some of the Senate’s majority vote on the measure had approved this plan only because of those revenue trigger safeguards.
But the House leadership realized the Senate’s error and ran with it. The error-riddled measure the Senate inadvertently sent to the House could now head to the governor and become law by only the removal of the holding motion pending in the House.
Lawmakers in the House and Senate often make mistakes in bills. Typically, they are fixed by resubmitting the bills or by both sides voting to suspend rules and fix the errors. It is uncommon for one chamber to seize on another’s mistake for one-upmanship. And it’s unheard of, at least in recent history, as means of passing sea change legislation such as overhauling the state tax code.
The House leadership, knowing the Senate sent a typo-riddled bill, had the opportunity to help fix it, or agree to use the Senate’s still-alive bill to make corrections. But House leaders chose instead to capitalize on the typos and send the bill, which was close to what they’d been proposing at least on income tax elimination, to the governor.
Accounts about how this transpired vary among many lawmakers. Some say Gov. Reeves’ office spotted the mistakes and notified the House. Others say Speaker White’s team spotted them. Regardless, neither the House nor Reeves looked a gift decimal in the mouth.
With the motion to reconsider pending for at least a few days before a deadline to address it, some lawmakers and politicos figured the House leadership would use it as leverage to force Hosemann and the Senate to agree to other provisions of the House plan, such as the sales tax increase, or to other separate legislation House leaders wanted, such as legalizing online betting.
Others surmised Hosemann couldn’t deliver on such demands, even if he agreed to them, because he had such a thin margin including the few Democrats passing the Senate’s plan to begin with.
And the leaders were mostly tight lipped about it on Thursday, even after Mississippi Today first reported the situation, until Reeves late that afternoon posted on social media that he was looking forward to receiving the bill on Friday and signing it into law.
“Today is a day for celebration!” the governor wrote on social media. He said: “I hear there are those who desire future tweaks to this law, and those can certainly be considered in future legislation.”
The House on Friday morning came in and, after some debate and some Democrats crying foul over the flawed legislation, cleared the procedural motion with a “voice vote.” Democrats tried unsuccessfully to force a recorded roll call vote. The accepted voice vote, meaning no record of how individual House members voted exists, sent the measure on to Gov. Reeves, who vowed on social media Friday to sign it into law.
After blatant mistake, Hosemann works to take credit
Hosemann did not mention the snafu to senators when he presided over a brief session on Friday before they left for the weekend. But he scheduled a press conference for Friday afternoon.
His press conference was rather short and bizarre. He acted as though he knew very little about the snafu, dodged questions and appeared to try to claim political victory with the measure being sent to the governor. Then, after some pointed questions about the typos the Senate sent to the House, he cut the presser off.
“Today is about the biggest win we have had on these issues in the history of this state,” Hosemann said of tax policy he’s opposed and warned people about being unwise for months.
He indicated there might be more negotiations on the issue between the Senate and House, although it’s unclear whether there would be much likelihood of major changes or of the House conceding to any Senate demands on the issue.
Hosemann called the final passage of the tax bill a “team effort” and refused to answer whether he believed the House had played dirty pool with passing the flawed bill.
Regardless, dozens of senators and House members elected by Mississippians believed they were voting on something far different than what they passed, and legislative leaders and the governor are apparently OK with that.
Lawmakers in recent years have complained about legislative leaders using a hurry-up offense to pass measures before opposition can build. They’ve complained they are not given time to vet, or sometimes even read, bills before they are passed.
The Senate’s typo-riddled bill was something of a rush job. It was presented in committee late Monday afternoon and quickly passed with little debate. It was voted on by the full Senate on Tuesday.
One could reasonably surmise that more time, perhaps some crowdsourcing with a public hearing or two, or a more robust vetting process in committee might have helped catch the mistakes.
The Senate plans were so new and rushed that no one had crunched the numbers on what they would mean for the average Mississippi family or taxpayer, at least not publicly. Some Democratic lawmakers on both sides of the building were surmising the tax savings would be minuscule or that some, such as retirees or the very poor, might see a net increase from the gasoline tax hike.
Though several questions remain and Senate leaders are hoping the House will help make some changes, the largest tax cut in Mississippi history, coupled with one of the largest tax increases in state history, is set to become law of the land because of a few typos and some legislative sleight of hand.
The Mississippi Typo Tax Swap Act of 2025 might be one of the most Mississippi things ever.
Sen. David Jordan of Greenwood, one of the longest serving members of the Legislature, has a phrase he’s said many times during debate on the Senate floor.
“Mississippi keeps stumbling into the future, backwards.”
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