Sales Tax Send-Off - - The News for South Mississippi

Sales Tax Send-Off

Large Mississippi businesses could soon be making their state sales tax payments more often. Some companies will have to pay weekly instead of monthly as they do now. It's part of the governor's plan to pull Medicaid out of an 148-Million dollar deficit. If Rex Distributing Company has to start making weekly sales tax payments to the state it would mean an adjustment, but it's one the company could handle. Company president Dan Magruder says, companies with less staff and cash flow might find it more difficult.

"If you pay your taxes on the 20th of the month, that's the day that you'll need most of your cash," Magruder said. "If you pay your taxes weekly, many businesses, and at one time we would have had trouble, would have had to borrow more money from back to do this."

Other large businesses like Mississippi Power expect keeping up with weekly payments will end up costing them more money.

"We pretty much have a monthly total that is kicked out of our computers based on the reports of what all our customers pay and then we cut a check to the state," spokesman Kurt Brautigam said. "If we had to to do that on a weekly basis, I'm sure we could do that but again just require that much more effort include that much more cost."

More than 4 thousand Mississippi companies would be affected by the governor's proposal. The tax commission chairman says even if all of them comply speeding up payments would only bring in about half of the 100 million dollars the governor hopes to raise.

Magruder said "All the additional cash to the state will have happen and at that time the state will start receiving the same amount monthly as they we're before. So what you have is a one shot revenue hurrying up your tax collections to a problem that appears to me to be an on-going problem."

Some companies may have to spend money upgrading their technology if the governor's proposal is adopted. Musgrove wants businesses who pay weekly to do it electronically. The state tax commission says most of those companies don't have that capability.

by Danielle Thomas

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