The legislative session has begun, and some of my colleagues in the Legislature, joined by Gov. Reeves, are pushing to expand what is already the state’s largest-ever income tax cut for the wealthy.
Despite what some of my colleagues claim, these tax cuts will only help the rich get richer at the expense of Mississippi’s working families and children. They will not grow our economy. In fact, they’ll actually leave us vulnerable to tougher, longer economic downturns at a time when economists and experts say a recession is likely looming.
When the economy slips, people lose their jobs. As times get tough, most people spend less. That means less revenue for businesses and for our state, which makes layoffs for teachers and cuts to health care and other public services more likely. It also makes it harder to provide things like unemployment benefits and temporary aid to ensure families can pay for things like food and housing.
The harm of these ill-conceived tax cuts is acute during a recession, but even without one, we know income-tax giveaways to the rich will worsen our already sky-high economic and racial inequality. Tax giveaways to the wealthy also mean less money for schools, clean water, roads and hospitals—all of which are vital to the success, health, and prosperity of kids, families and businesses.
Make Mississippi Families and Businesses Stronger
Because Mississippi’s wealthy are more likely to be white, and those with low incomes are more likely to be people of color—a legacy of our history—these costly tax cuts will also make racial disparities worse. There are better solutions.
We must recognize that our tax code already asks for far more from minimum-wage and middle-income earners than it does from those who are paid the most. The bottom 80% of Mississippi taxpayers (those earning below $77,500 per year) pay a larger share of their income in state and local taxes than those in the top 20%, an analysis from One Voice Mississippi shows. The tax cut enacted last year will only turn our tax code further upside-down.
If we want to make Mississippi families and businesses stronger—especially in a tough economy—we should focus any tax changes on children and working families, not the wealthy.
Mississippi could do that by creating its own child tax credit. Eleven states have already done so to improve child wellbeing, in which Mississippi ranks last, and improve long-term child outcomes. Parents will remember the child payments they received during the peak of the economic crisis, which helped pay for child care, food, diapers and other childcare costs. Those payments came from the federal Child Tax Credit but have since ended, and now child poverty is once again on the rise.
Mississippi could also create a state-level Earned Income Tax Credit and follow the success of 31 other states. The EITC is a commonsense tax break for people who work but aren’t paid enough to make ends meet. That is money to help cover the basics and provide a cushion when the unexpected strikes, like an illness or an urgent car or home repair. And because working people spend their money locally, the EITC also benefits local businesses and our communities.
Given the choice between more tax cuts for the wealthy and enacting commonsense tax policies that protect children, strengthen working families and improve our economy, I think the choice is obvious.
So this year, let’s create a fairer and smarter tax policy.
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