JACKSON, Miss. (WLBT) -Legislative leaders are moving closer to an agreement on how they’d like to cut taxes. Both the House and Senate are changing up their original tax reform plans. And they both now include a path to full elimination of the state income tax.

The Senate Finance Committee is offering up a new version of a Senate tax plan. The committee approved inserting that language into House Bill 1 late Monday.

It offers a gradual path to elimination of the income tax but it’s not automatic.

“We feel very responsible in the sense that you know it’s going to put up some guardrails if the economy is not performing, we’re not going to cut,” explained Sen. Josh Harkins, Senate Finance Chairman. “But if the economy is performing and we have excess revenues, we’re going to give back to citizens in the form of income tax reduction.”

Their new plan would not include any sales tax increases. That is a difference from the House plan.

“We wanted to make sure that every year we had a tax decrease,” noted Lt. Governor Delbert Hosemann. “Not that we had a shuffle among taxes that may have a tax increase, but a tax decrease every year. That was very important to us. We don’t want to raise the sales tax.”

The Senate plan includes creating a 5th tier for new state employees, meaning they wouldn’t get the same benefits as current or retired employees.

“I had repeated calls and I have an email from Ray Higgins who is head of PERS saying… watching this go on and said listen, please don’t leave… please don’t let whatever other issues are involved, income tax or sports betting or something, get involved in not curing PERS,” added Hosemann.

At the same time, the House Ways and Means Committee made some changes to their plan and inserted that into the Senate bill. A release notes that some of the revisions stem from negotiations with the Senate.

Now, both chambers agree on an immediate grocery tax reduction from 7 to 5 percent. They’re also changing the way they’d increase tax on gas, suggesting a three-year phased-in increase of a few cents. But they propose 5 cents each year for 3 years rather than the 3 cents the Senate suggested.

“We are on the cusp of bringing all Mississippians the most significant tax cut in state history,” said Speaker Jason White. “This cut would provide a tax credit to seniors on their property taxes, reward our workforce, and relieve the tax burden at the grocery store while also stabilizing PERS, dedicating a source of revenue to infrastructure, and enhancing our economic development opportunities.”

“The Mississippi House of Representatives continues working hard to make our great state the best place to work, worship, and raise a family.”

Both chambers have till the end of the day Tuesday to get those amended bills passed off the floor before the next deadline.

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