Bill Text: MS SB2145 | 2013 | Regular Session | Introduced

Mississippi Senate Bill 2145 (Prior Session Legislation)

Introduced

Bill Title: Sales tax; give municipalities the option to impose.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Failed) 2013-02-27 - Died In Committee [SB2145 Detail]

Download: Mississippi-2013-SB2145-Introduced.html

MISSISSIPPI LEGISLATURE

2013 Regular Session

To: Finance

By: Senator(s) Butler (38th), Jones

Senate Bill 2145

AN ACT TO AUTHORIZE THE GOVERNING AUTHORITIES OF ANY MUNICIPALITY TO IMPOSE A SPECIAL SALES TAX OF NOT MORE THAN 1% ON THE GROSS PROCEEDS OF ALL SALES OR THE GROSS INCOME OF BUSINESSES IN THE MUNICIPALITY DERIVED FROM ACTIVITIES TAXED AT THE RATE OF 7% OR MORE UNDER THE MISSISSIPPI SALES TAX LAW; TO PROVIDE THAT THE SPECIAL SALES TAX SHALL NOT BE LEVIED UNLESS AUTHORIZED BY AT LEAST THREE-FIFTHS OF THE VOTES CAST AT A REFERENDUM CALLED AND HELD FOR SUCH PURPOSE; TO AUTHORIZE A MUNICIPALITY TO INCUR INDEBTEDNESS IN AN AMOUNT NOT GREATER THAN AN AMOUNT FOR WHICH DEBT SERVICE IS CAPABLE OF BEING FUNDED BY THE PROCEEDS OF THE SPECIAL SALES TAX; TO PROVIDE THAT THE SPECIAL SALES TAX REVENUE COLLECTED PURSUANT TO SUCH A TAX SHALL BE USED AND EXPENDED BY THE MUNICIPALITY TO FUND CAPITAL PROJECTS; TO PROVIDE FOR THE DISCONTINUANCE OF THE SPECIAL SALES TAX UPON COMPLETION OF THE FUNDING OF THE PROJECTS FOR WHICH THE TAX WAS LEVIED; TO AMEND SECTION 21-33-303, MISSISSIPPI CODE OF 1972, IN CONFORMITY THERETO; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. (1) Subject to the provisions of this section, the governing authorities of any municipality may impose upon all persons as a privilege for engaging or continuing in business or doing business within such municipality, a special sales tax at the rate of not more than one percent (1%) of the gross proceeds of sales or gross income of the business, as the case may be, derived from any of the activities taxed at the rate of seven percent (7%) or more under the Mississippi Sales Tax Law, Section 27-65-1 et seq. The tax levied under this section shall apply to every person making sales, delivery or installations of tangible personal property or services within any municipality which has adopted the levy authorized in this section but shall not apply to sales exempted by Sections 27-65-19, 27-65-101, 27-65-103, 27-65-105, 27-65-107, 27-65-109 and 27-65-111 of the Mississippi Sales Tax Law.

(2) Before any tax authorized under this section may be imposed, the governing authorities of the city shall adopt a resolution declaring its intention to levy the tax, setting forth the amount of the tax to be imposed, the capital projects for which the revenue collected pursuant to the tax levy may be used and expended, the date upon which the tax shall become effective and calling for a referendum to be held on the question. The date of the referendum shall be set in the resolution. Notice of the referendum shall be published once each week for at least three (3) consecutive weeks in a newspaper published or having a general circulation in the municipality, with the first publication of the notice to be made not less than twenty-one (21) days before the date fixed in the resolution for the referendum and the last publication to be made not more than seven (7) days before the referendum. At the referendum, all qualified electors of the municipality may vote. The ballots used at the referendum shall have printed thereon a brief description of the sales tax, the amount of the sales tax levy, a description of the projects for which the tax revenue may be used and expended and the words "FOR THE LOCAL SALES TAX" and "AGAINST THE LOCAL SALES TAX" and the voter shall vote by placing a cross (X) or check mark (√) opposite his choice on the proposition. When the results of the referendum have been canvassed by the election commissioners of the municipality and certified by them to the governing authorities, it shall be the duty of the governing authorities to determine and adjudicate whether at least three-fifths (3/5) of the qualified electors who voted in the referendum voted in favor of the tax. If at least three-fifths (3/5) of the qualified electors who voted in the referendum voted in favor of the tax, the governing authorities shall adopt a resolution declaring the levy and collection of the tax provided in this section and shall set the first day of the second month following the date of such adoption as the effective date of the tax levy. A certified copy of this resolution, together with the result of the referendum, shall be furnished to the Department of Revenue not less than thirty (30) days before the effective date of the levy.

(3) The capital projects for which the revenue collected pursuant to the tax levy imposed under this section may be used and expended shall include, but not be limited to, the following:

(a) Recreational complexes;

(b) Senior centers;

(d) Auditoriums;

(e) Libraries;

(f) Major street projects;

(g) Water and sewage systems;

(h) Gas lines; and

(i) Multipurpose buildings.

(4) (a) The special sales tax authorized by this section shall be collected by the Department of Revenue, shall be accounted for separately from the amount of sales tax collected for the state in the municipality and shall be paid to the municipality in which collected. The Department of Revenue may retain three percent (3%) of the proceeds of the tax for the purpose of defraying the costs incurred by the department in the collection of the tax. Payments to the municipality shall be made by the Department of Revenue on or before the fifteenth day of the month following the month in which the tax was collected.

(b) The proceeds of the special sales tax shall be placed into a separate fund apart from the municipal general fund and any other funds of the municipality, and shall be expended by the municipality solely for the purpose of paying any indebtedness or other obligation incurred or that may be incurred by the municipality for the capital projects specified in the resolution ordering the referendum.

(c) All provisions of the Mississippi Sales Tax Law applicable to filing of returns, discounts to the taxpayer, remittances to the Department of Revenue, enforced collection, rights of taxpayers, recovery of improper taxes, refunds of overpaid taxes or other provisions of law providing for imposition and collection of the state sales tax shall apply to the special sales tax authorized by this section, except where there is a conflict, in which case the provisions of this section shall control. Any damages, penalties or interest collected for the nonpayment of taxes imposed under this section, or for noncompliance with the provisions of this section, shall be paid to the municipality in which such damages, penalties or interest were collected on the same basis and in the same manner as the tax proceeds. Any overpayment of tax for any reason that has been disbursed to any municipality or any payment of the tax to any municipality in error may be adjusted by the Department of Revenue on any subsequent payment to the municipality involved pursuant to the provisions of the Mississippi Sales Tax Law. The Department of Revenue may, from time to time, make such rules and regulations not inconsistent with this section as may be deemed necessary to carry out the provisions of this section, and such rules and regulations shall have the full force and effect of law.

(d) The special sales tax shall be discontinued by the governing authorities of the municipality on the first day of the month immediately succeeding the date any indebtedness, including interest, incurred by the municipality for the projects is retired, or in the event the municipality incurs no indebtedness, the first day of the month after all obligations for the projects have been paid. Any amount remaining in the separate fund containing the proceeds of the special sales tax not necessary to retire the debt or pay any other obligations, shall be transferred to the municipal general fund.

(e) The governing authorities of a municipality may not impose a special sales tax under this section on sales that are subject to any tax levied and collected (before the date a resolution is adopted under subsection (2) of this section) under the authority of a local and private law of the State of Mississippi, and which tax is collected and paid to the Department of Revenue in the same or similar manner that state sales taxes are collected and paid.

(f) If a municipality imposing a special sales tax under this section expands its corporate boundaries, the governing authorities of the municipality may not impose the special sales tax in the annexed area unless the tax is approved at a referendum conducted, as far as is practicable, in the manner provided in subsection (2) of this section, except that only qualified electors in the annexed area may vote in the referendum.

(g) If a municipality imposing a special sales tax under this section contracts its corporate boundaries, the special sales tax shall continue to be imposed in the area that was in the corporate boundaries of the municipality before the contraction of such boundaries.

(5) The governing authorities of any municipality that levies a special sales tax pursuant to this section may incur indebtedness of the municipality in an aggregate principal amount that is not in excess of an amount for which debt service is capable of being funded by the proceeds of the special sales tax levied pursuant to this section. The indebtedness authorized by this subsection shall not be considered when computing any limitation of indebtedness of the municipality established by law.

SECTION 2. Section 21-33-303, Mississippi Code of 1972, is amended as follows:

21-33-303. No municipality shall hereafter issue bonds secured by a pledge of its full faith and credit for the purposes authorized by law in an amount which, when added to the then outstanding bonded indebtedness of such municipality, shall exceed either (a) fifteen percent (15%) of the assessed value of the taxable property within such municipality, according to the last completed assessment for taxation, or (b) ten percent (10%) of the assessment upon which taxes were levied for its fiscal year ending September 30, 1984, whichever is greater. In computing such indebtedness, there may be deducted all bonds or other evidences of indebtedness, heretofore or hereafter issued, for school, water, sewerage systems, gas, and light and power purposes and for the construction of special improvements primarily chargeable to the property benefited, or for the purpose of paying the municipality's proportion of any betterment program, a portion of which is primarily chargeable to the property benefited. However, in no case shall any municipality contract any indebtedness which, when added to all of the outstanding general obligation indebtedness, both bonded and floating, shall exceed either (a) twenty percent (20%) of the assessed value of all taxable property within such municipality according to the last completed assessment for taxation or (b) fifteen percent (15%) of the assessment upon which taxes were levied for its fiscal year ending September 30, 1984, whichever is greater. Nothing herein contained shall be construed to apply to contract obligations in any form heretofore or hereafter incurred by any municipality which are subject to annual appropriations therefor, or to bonds heretofore issued by any municipality for school purposes, or to contract obligations in any form heretofore or hereafter incurred by any municipality which are payable exclusively from the revenues of any municipally owned utility, or to bonds issued by any municipality under the provisions of Sections 57-1-1 through 57-1-51, or to any special assessment improvement bonds issued by any municipality under the provisions of Sections 21-41-1 through 21-41-53, or to any indebtedness incurred under Section 55-23-8, or to any indebtedness incurred under Section 1 of this act.

All bonds issued prior to July 1, 1990, pursuant to this chapter by any municipality for the purpose of the constructing, replacing, renovating or improving wastewater collection and treatment facilities in order to comply with an administrative order of the Mississippi Department of Natural Resources issued pursuant to the Federal Water Pollution Control Act and amendments thereto, are hereby exempt from the limitation imposed by this section if the governing body of the municipality adopts an order, resolution or ordinance to the effect that the rates paid by the users of such facilities shall be increased to the extent necessary to provide sufficient funds for the payment of the principal of and interest on such bonds as each respectively becomes due and payable as well as the necessary expenses in connection with the operation and maintenance of such facilities.

SECTION 3. It is the intent of the Legislature that the amount of state general funds appropriated to the Department of Revenue shall not be reduced because of funds collected by the department under this act.

SECTION 4. Section 1 of this act shall be known and may be cited as the "Citizens for Economic Development Act."

SECTION 5. The Attorney General of the State of Mississippi shall submit this act, immediately upon approval by the Governor, or upon approval by the Legislature subsequent to a veto, to the Attorney General of the United States or to the United States District Court for the District of Columbia in accordance with the provisions of the Voting Rights Act of 1965, as amended and extended.

SECTION 6. This act shall take effect and be in force from and after July 1, 2013, if it is effectuated on or before that date under Section 5 of the Voting Rights Act of 1965, as amended and extended. If it is effectuated under Section 5 of the Voting Rights Act of 1965, as amended and extended, after July 1, 2013, this act shall take effect and be in force from and after the date it is effectuated under Section 5 of the Voting Rights Act of 1965, as amended and extended.