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Internet sales tax bill not expected to survive Tuesday deadline

Mississippi Senate leadership said they will not consider a bill to tax internet sales. 

With the Tuesday deadline of bill approval out of committee only one day away, Sen. Joey Fillingane, Chairman of the finance committee and Lt. Gov. Tate Reeves said House Bill 480 would not survive Tuesday’s deadline for committee action.

“Because the Supreme Court made it clear 25 years ago that states do not have the authority to tax Internet sales, this bill is unconstitutional and any promised new revenue is simply fake money,” Lt. Gov. Reeves said.

House Bill 480 would mandate a tax on internet sales for businesses with no physical address in Mississippi. It is currently in the Senate Finance Committee.

“While this bill is well intentioned, it does not accomplish what it sets out to fix,” Sen. Fillingane said. “Also, the Senate Finance Committee generally looks for ways to lower taxes and grow our economy, not raise taxes.”

In 1992 the Supreme Court ruled that only sales from companies with a physical address within a state would be subject to state sales or use taxes. According to the Department of Revenue, about $40 million is paid by Mississippians as a use tax for online purchases under current law. House Bill 480 could reduce General Fund collections by as much as $40 million in Fiscal 2018.

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