| Our budget proposes limiting the growth of Mississippi’s government spending so that it does not increase faster than the rate of population change plus inflation. That would mean a general fund appropriation for 2024 of no more than $6.75 billion.
To increase spending over and above that amount would mean raising spending per person in our state faster than inflation. That would be un-conservative.
If lawmakers follow our advice, we estimate that there will be a budget surplus of around $800 million in 2024 – a portion of which could be used to reduce the tax burden yet further.
“But can we afford further tax cuts?” some will ask.
During the 2023 legislative session, some lawmakers will no doubt tell us that Mississippi cannot afford further tax cuts – just as they did in the last session. If we’re not careful, they’ll claim, Mississippi could end up like Kansas.
Kansas cut taxes without controlling spending – which is why they ran out of money. The Responsible Mississippi Budget that we publish today takes the opposite – and truly conservative – approach. We limit spending first and having done so work out what taxes we can afford to cut.
Mississippi today has record cash reserves. The idea that politicians in Jackson cannot afford to let you keep more of your own money says more about them than it does about the state of our state’s finances.
We believe that Mississippi’s budget surplus is both cyclical and structural. That is to say the surplus will not completely disappear as and when the economy slows. Provided Mississippi lawmakers keep spending under control there will be money left over to reduce taxes.
Over the past thirty years, the southern United States has flourished. Tennessee, Texas, Georgia and Florida have enjoyed rapid growth. Dallas and Nashville have become go-to places for ambitious young people right across America.
Why are these southern states doing so well? Because they have low taxes and light regulations. Three of the fastest-growing southern states don’t have a personal state income tax at all.
Our Responsible Mississippi Budget provides a roadmap for us to become part of that southern success story, too.
Have a wonderful weekend – and Happy New Year! |
