Tax plan calls for higher cigarette prices

A commission appointed by Governor Haley Barbour to look at Mississippi's tax structure has released its preliminary recommendations, one of which is an increase in the cigarette tax.

The 38-page draft said modifications are needed to the state's tax structure. Among other things, the report makes two recommendations on the cigarette tax - an increase from 18 cents a pack to 36 cents a pack, or a flat 50 cent tax on cigarettes.

It also calls for creating a new tax on tobacco manufacturers that were not involved in the mammoth tobacco settlement.

There would be no changes in taxes on beer, light wine, or gaming.

The report also recommended cities be allowed to levy a local sales tax for specific purposes with the approval of 60 percent of those voting in a referendum. The tax would go away after the specific need was met.

It also calls for counties to receive a percentage of state sales taxes. Recommendations call for less than 1 percent. Cities would continue to get their 18.5 percent share.
And the report also recommended removing exemptions for non-profit organizations.

Under the plan, non-profit groups and charities would have to pay taxes on purchases for their own use. The task force is expected to vote on the recommendations this week.