What It Means for You
How It Affects Taxes
Almost all city and county taxes (except school taxes) on land, building, equipment and personal property are waived / abated for a period of 10 years. The city may require that you pay a nominal fee for police and fire protection.
You will pay no sales or use taxes on equipment or building materials paid for directly by your company.
State Income Taxes
The State of Mississippi has an effective income tax rate of approximately 5% on net income (sliding scale which quickly reaches 5%). Companies in Growth and Prosperity Program (GAP) counties pay no state income tax for 10 years. However, this credit “may” be meaningless to certain types of corporations, which pass tax liability to individual owners. Out of state owners of Sub Chapter S or other income-pass through type businesses, which live out of state, should address the issue directly with their home state tax authorities to see if they will accept Mississippi credits. If this applies to your company I will be happy to provide you with the name of the person at the Mississippi State Tax Commission with whom you can discuss the issue. Mississippi residents receive full benefit from the credits as do regular corporations.
Mississippi assesses a franchise tax of $2.50 per $1,000 of the value of capital used in the state. For multi-state corporations a complicated formula is used to determine the Mississippi tax. However, companies located in GAP counties pay no franchise tax for the first 10 years, on capital allocated to the GAP county.
GAP does not exempt taxes on finished goods inventory. However, Mississippi does offer total exemptions on finished goods inventory being sent out of state and partial exemptions on finished goods inventory being shipped to in-state customers. If you anticipate significant finished goods inventory to be on hand at year-end, your company can apply to appropriate local government bodies for exemptions. These exemptions have historically been granted as requested in Leflore County and the City of Greenwood.
Keep reading for information on the various finance and grant programs available.