January 18, 2006

Statement of Governor Haley Barbour on the veto of Senate Bill 2310

The House and Senate have passed a bill proposing to eliminate the sales tax on groceries and increase the tax on cigarettes. Initial claims that this proposal was simple and revenue-neutral were simply inaccurate. Tonight, I can tell you this bill is ill-conceived, barely researched, poorly timed and passed in great haste. It is irresponsible to cut Mississippi’s budget revenue while we’re trying to recover from Hurricane Katrina, but this bill does that. It would also shortchange our towns and cities – many of which are already financially strapped. And, it would destroy our ability to increase needed funding for education and other priorities in the future.

Over its nine-year life Senate Bill 2310, as passed, would result in a $1.5 billion loss of revenue to the state and cut revenues to municipalities by $166 million. It would hit especially hard at small towns, which depend more on sales taxes on groceries to support essential public services. By any accounting, this huge revenue loss would mean lower funding for education and basic services, and also lead to tax increases, ranging from ad valorem taxes … to sales taxes on products other than groceries … and higher income taxes. There’s nothing revenue neutral about this bill.

At this historic moment, it would be irresponsible to reduce state tax revenues. We need more funding for education and other priorities, not less. We need budget stability, not risk.

From September till December I met with Congress and President Bush to ask them to help Mississippi in our time of desperate need. Senator Cochran, Senator Lott, the Congressional delegation, we all fought to get federal help to recover and rebuild. Congress responded with an additional ten billion dollars to help Mississippi get through our crisis.

Now the Legislature has voted to cut our state revenue by $1.5 billion effectively saying, “We don’t need it”. The Legislature is wrong, and I wonder what those people who helped us in our hour of desperation will think. They give 10 billion dollars to help us and we cut our own effort to help ourselves by 1.5 billion dollars. What kind of shell game must they think we’re trying to pull?

This bill is bad policy. It will hurt education and other priorities. It will raise your property taxes and your income taxes. It is bad for Mississippi, which is why I am vetoing it.



 

 


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Governor Haley Barbour
P.O. Box 139 Jackson, MS 39205
Phone: 601.359.3150 Fax: 601.359.3741