Bill Text: MS SB2840 | 2026 | Regular Session | Engrossed

Mississippi Senate Bill 2840

Bill Title: Inventory tax; require Department of Revenue to provide report containing certain 2025 information regarding.

Sponsorship: Partisan Bill (Republican 1)

Status: (Failed) 2026-03-17 - Died In Committee [SB2840 Detail]

Download: Mississippi-2026-SB2840-Engrossed.html

MISSISSIPPI LEGISLATURE

2026 Regular Session

To: Finance

By: Senator(s) Johnson

Senate Bill 2840

(As Passed the Senate)

AN ACT TO REQUIRE THE DEPARTMENT OF REVENUE TO COLLECT DATA FROM EACH COUNTY SHOWING TOTAL REVENUE FROM THE INVENTORY TAX FOR THE 2025 TAX YEAR; TO REQUIRE THE DEPARTMENT TO PROVIDE TO THE CHAIRMEN OF THE SENATE FINANCE COMMITTEE AND THE HOUSE WAYS AND MEANS COMMITTEE, NO LATER THAN DECEMBER 1, 2026, A REPORT CONTAINING INFORMATION FROM THE 2025 TAX YEAR REGARDING TOTAL REVENUE FROM THE INVENTORY TAX, TOTAL AMOUNT OF CREDITS CLAIMED FOR INVENTORY TAX PAYMENTS, CATEGORIZED BY ENTITY TYPE, AND TOTAL AMOUNT OF CREDITS ALLOCATED FOR INVENTORY TAX PAYMENTS, CATEGORIZED BY ENTITY TYPE; TO BRING FORWARD SECTION 27-7-22.5, MISSISSIPPI CODE OF 1972, FOR THE PURPOSE OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.

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

SECTION 1. The Department of Revenue shall collect data from each county showing total revenue from the inventory tax for the 2025 tax year. No later than December 1, 2026, the department shall provide to the Chairmen of the Senate Finance Committee and the House Ways and Means Committee a report containing the following information:

(a) The total amount of revenue received by all counties in the state from the inventory tax in 2025;

(b) The total amount of credits claimed under Section 27-7-22.5, Mississippi Code of 1972, for inventory taxes paid in 2025, categorized by entity type; and

(c) The total amount of credits allocated under Section 27-7-22.5, Mississippi Code of 1972, for inventory taxes paid in 2025, categorized by entity type.

SECTION 2. Section 27-7-22.5, Mississippi Code of 1972, is brought forward as follows:

27-7-22.5. (1) (a) For any manufacturer, distributor, wholesale or retail merchant who pays to a county, municipality, school district, levee district or any other taxing authority of the state or a political subdivision thereof, ad valorem taxes imposed on commodities, raw materials, works-in-process, products, goods, wares and merchandise held for resale, a credit against the income taxes imposed under this chapter shall be allowed for the portion of the ad valorem taxes so paid in the amounts prescribed in subsection (2).

(b) (i) For any person, firm or corporation who pays to a county, municipality, school district, levee district or any other taxing authority of the state or a political subdivision thereof, ad valorem taxes imposed on rental equipment, a credit against the income taxes imposed under this chapter shall be allowed for the portion of the ad valorem taxes so paid in the amounts prescribed in subsection (2).

(ii) As used in this paragraph, "rental equipment" means any rental equipment or other rental items which are held for short-term rental to the public:

1. Under rental agreements with no specific term;

2. Under at-will or open-ended agreements; or

3. Under rental agreements with terms ordinarily of less than three hundred sixty-five (365) days; and

4. Is not subject to privilege taxes imposed in Chapter 19, Title 27, Mississippi Code of 1972.

(c) The tax credit allowed by this section may not be claimed by a taxpayer that is a medical cannabis establishment as defined in the Mississippi Medical Cannabis Act.

(2) The tax credit allowed by this section shall not exceed the amounts set forth in paragraphs (a) through (g) of this subsection; and may be claimed for each location where such commodities, raw material, works-in-process, products, goods, wares, merchandise and/or rental equipment are found and upon which the ad valorem taxes have been paid. Any tax credit claimed under this section but not used in any taxable year may be carried forward for five (5) consecutive years from the close of the tax year in which the credit was earned.

(a) For the 1994 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Two Thousand Dollars ($2,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(b) For the 1995 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Three Thousand Dollars ($3,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(c) For the 1996 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Four Thousand Dollars ($4,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(d) For the 1997 taxable year and each taxable year thereafter through taxable year 2013, the tax credit for each location of the taxpayer shall not exceed the lesser of Five Thousand Dollars ($5,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(e) For the 2014 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Ten Thousand Dollars ($10,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(f) For the 2015 taxable year, the tax credit for each location of the taxpayer shall not exceed the lesser of Fifteen Thousand Dollars ($15,000.00) or the amount of income taxes due the State of Mississippi that are attributable to such location.

(g) For the 2016 taxable year and each taxable year thereafter, the tax credit of the taxpayer shall be the lesser of the amount of the ad valorem taxes described in subsection (1) paid or the amount of income taxes due the State of Mississippi that are attributable to such location.

(3) Any amount of ad valorem taxes paid by a taxpayer that is applied toward the tax credit allowed in this section may not be used as a deduction by the taxpayer for state income tax purposes. In the case of a taxpayer that is a partnership, limited liability company or S corporation, the credit may be applied only to the tax attributable to partnership, limited liability company or S corporation income derived from the taxpayer.

(4) Any amount of ad valorem taxes applied and used as a tax credit under Section 27-31-19.1 may not be applied and used as a tax credit under this section.

SECTION 3. This act shall take effect and be in force from and after July 1, 2026, and shall stand repealed on June 30, 2026.