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Lawmakers pass new income tax credit legislation

JACKSON — A bill to give businesses a larger income tax credit when they pay inventory taxes is headed to Mississippi Gov. Phil Bryant.

The final version of Senate Bill 2934 passed the Senate yesterday, two days after clearing the House.

The bill would increase the tax credit in phases. First, it would double the ceiling on the credit to $10,000 in 2014. In 2015 it would raise the ceiling to $15,000. Finally, in 2016, it would make the credit equal to state income tax or inventory tax, whichever is the smaller figure. That means a company paying $20,000 in inventory taxes and $21,000 in income tax would get a tax credit of $20,000.

House Ways and Means Chairman Jeff Smith, R-Columbus, said the lag time between now and 2014 would give the state economy more time to recover before the bill would impact the treasury.

Sen. Hob Bryan, D-Amory, who strongly opposes the bill, called Monday the worst day of his legislative career, partly because of the passage of the tax bill.

“Apparently, there are a large number of people whose most important concern is giving money back to Walmart,” Bryan said. “I think the bill is absurd. We don’t have any money to do any of that.”

Smith said most large corporations would not qualify for the credit because their headquarters are outside of Mississippi. Therefore, their state income tax figure is zero and they would receive an equivalent credit. Smith also said the bill could attract more corporations to relocate to the state to qualify for the credit.

Bryant looks forward to signing the bill into law because it is an issue he has long supported, his spokesman said.

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