Proposed policy to achieve “brain gain” in Mississippi. Focused on retention and attraction of a knowledge-based workforce.
Mississippi is the only Sun Belt state to experience a net outmigration of population over the last 10 years. The majority of those leaving the state are educated potential high-wage earners that have recently graduated from Mississippi colleges or universities.This has a negative impact on economic development, workforce development, entrepreneurism, corporate retention and attraction (especially of knowledge-based companies).
In 2015 House Bill 1601, called the “Mississippi Jobs Creation Act of 2015” was filed. The bill sought to give recent graduates of Mississippi colleges/universities a 5-year state income tax hiatus if they took a “qualifying job” in state. In advance of the 2018 legislative session, the proposed legislative concept has been refined.
Fast Forward Mississippi seeks to revive the 2015 concept with significant changes for the 2018 legislative session. Proposed new structure of the policy would be as follows:
- Recent graduates of any accredited college or university (not just in MS) or certified technical training program would be eventually eligible for a state income tax rebate upon becoming an employed taxpayer in Mississippi within one year of graduation (essentially taking a job in Mississippi). The rebate, or bonus, would come as a result of remaining a tax-paying Mississippian for five years.
- Rather than being a tax credit on yearly income tax, qualifying individuals will pay their state tax at normal tax rates. The tax dollars from these qualifying individuals are collected by the state and ideally held in an interest-bearing fund over the course of the five year period.
- At the end of the fifth year of in-state employment, the qualified individual will receive their rebate in the form of a one lump-sum refund.
- If the qualifying individual uses 75% or more of the lump-sum rebate to purchase real estate in Mississippi (commercial or residential), the individual will receive the rebate 100% tax-free.
- If the qualifying individual is an owner of a Mississippi-registered business (an LLP or LLC registered through the MS Secretary of State’s Office or a shareholder in a Mississippi-based “closely held” corporation registered with the MS Secretary of State’s Office), the individual will receive the refund 100% tax-free.
- If the qualifying individual does not meet one or both of the criteria described above, they will receive their rebate as a lump sum payment with a one-time state tax of XX% (rate TBD. Ideally it would fall around 10%).
- If the individual establishes residence in another state anytime during the five year period, the entire tax rebate is forfeited and the state keeps the money.
- The state keeps all interest accrued during five year period it is holding the collected taxes.
We ask for your support. Let’s do it, Mississippi. #MSBrainGain