JACKSON - With the final death Tuesday in the state Senate of the 2007 version of a combined tax swap bill, political reality looms both for those who supported the tax swap and for those who opposed it. The bill would have cut the state's 7 percent grocery tax in half while raising the state's 18-cent per pack cigarette excise tax to $1 a pack
Gov. Haley Barbour and his troops in the Senate won the day and did so within the margins of the Senate rules. Any last-minute heroics by pro-tax swap forces to take the issue away from a committee chairman were doomed from the start.
The 31-20 Senate procedural vote that could have revived the twice-dead tax swap legislation is evidence that the overall issues are far from dead. Some 60 percent of the Senate supported at least voting on the tax swap measure. The measure failed by only three votes to attain the two-thirds majority needed for passage.
But a majority of both houses of the Legislature favors these measures, or at the very least feared going home to campaign for re-election daubed with the brush of being against them.
Barbour lost the votes of eight Republican senators on the procedural votes - some who have been close allies on other measure.
Barbour will continue to face Democratic Party criticism over the fact that he's killed the tax swap for the last two years. But the governor isn't retreating from the criticism.
What will be different in 2008 on these issues is that the shadow of statewide elections will be in the rearview mirror for the Legislature and the Barbour administration alike.
In the future, efforts to either raise the state's cigarette tax or reduce or eliminate the state's sales tax on groceries won't be joined at the hip. There is already talk from Republican and Democratic lawmakers alike on the need to deal with each issue separately, and it appears that strategies are already taking shape to avoid a third straight year of political bloodletting over these policy differences.
Look for efforts to raise the state's cigarette tax to focus not on the national cigarette tax average as it has the last two years at a goal of about $1 a pack, but at the regional level.
In the surrounding states, Alabama charges 42.5 cents per pack while the price in Arkansas is 59 cents. Louisiana's cigarette tax is twice that of Mississippi's at 36 cents per pack, and Tennessee legislators appear on the verge this week of raising their present 20 cents per pack tax to 60 cents per pack.
If Tennessee lawmakers take that action - and it appears likely that they will - the regional average cigarette tax would be in round numbers 50 cents per pack.
So look for future versions of efforts to raise Mississippi's cigarette tax to focus on a 40- to 50- cent per pack increase. Politically, an increase to the regional average would be more palatable to conservative lawmakers in both parties. It would also be more difficult for Barbour to oppose that level of increase without making his past legitimate lobbying ties to Big Tobacco even more of a liability.
The grocery sales tax issue is less predictable. Municipal governments will never drop their opposition to decreasing the tax because of political fears of future property tax hikes.
Despite the demonstrably regressive nature of sales taxes, many Mississippians like the idea of the poor paying sales taxes and particularly like the idea of taxing immigrant workers in that way.
In the teeth of this year's tax swap battle, Barbour promised non-specific tax reduction proposals in the future. If true to Reagan Republican form, Barbour's tax relief will likely center on state income taxes. It's feasible that a state earned income tax credit along the lines of the federal model might well be his nod to helping the state's poor and working poor.
