Will the 'Taxpayer Pay Raise Act' pay out? - MSNewsNow.com - Jackson, MS

Will the 'Taxpayer Pay Raise Act' pay out?

Source: WLBT Source: WLBT
Source: WLBT Source: WLBT
Source: WLBT Source: WLBT
JACKSON, MS (Mississippi News Now) -

Slowly going into effect at the beginning of next year, the Taxpayer Pay Raise Act will give all Mississippians the chance to get more money back on their income tax returns while, also, eliminating corporate franchise tax completely by 2028.

Corporate franchise tax currently comes in as the state's sixth largest revenue source. A big chunk of Mississippi's budget that many say we can't afford to lose since last year's budget came in $170 million short. However, supporters of the move say it is necessary because Mississippi is just one of only 17 states that still charges a corporate franchise tax.

"The assumption is, that by generating more business and more spending, it's going to increase income and sales taxes," said Belhaven University economics professor Dr. William Penn. "Which will give more revenue for the state to spend. Now, will it do that? That's the question."

For this law to be a success for our economy, it will be crucial for businesses to expand and reinvest their money in Mississippi. However, in this law, there's no clause that ensures that. 

In the first year of eliminating the corporate franchise tax, the state could lose  $18 million in revenue, that going up to nearly $50 million by 2019 then nearly $300 million once completely phased out in 2028.

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