staff and wire reports



Lt. Gov. Phil Bryant said when legislators return to the Capitol next month — tentatively set for May 6 — he’s hopeful they will find common ground on a few key areas: car tag relief, a tobacco tax increase and Medicaid.

Bryant, who made a brief stop in Meridian on Monday before traveling to Newton for a Lion’s Club meeting, said the fact that House and Senate leaders are “only 11 cents apart” on the tobacco tax increase gives him hope.

Mississippi’s cigarette excise tax of 18 cents a pack is the third-lowest in the nation.

The House started this year trying to set the tax at $1 a pack, and the Senate started at 49 cents. The Senate has gone up to 64 cents a pack for premium brands and 84 cents a pack for generics. House negotiators have gone down to 75 cents a pack for all cigarettes.

Bryant said May 6 is the tentative date for the full House and Senate to return to Jackson to finish writing a budget for the year that begins July 1.

“Eleven cents doesn’t sound like a lot in the real world but when you start talking about delicate negotiations between House and Senate members and the governor (it’s tough),” Bryant said. “The governor’s not so concerned about the amount of the tax but rather what it will produce so that we don’t come back and artificially inflate what the revenue will be and then come back in a couple of years and say, it didn’t produce what we thought it would and therefore we have another fiscal problem.”

Some legislative leaders, including Bryant, have been pushing for months to increase the cigarette tax to hold down the price of car tags. Bryant repeated his support of that idea Monday, a day before three House members and three senators return to the Capitol to restart their stalled negotiations on the cigarette tax.

Bryant also unveiled a new Web site that he said would provide accurate information about a possible increase in the price of Mississippi car tags. The site — www.cartagrelief.com — originally included a few errors but Bryant’s staff was working Monday to correct the problem after the Associated Press brought it to their attention.

While the price of tags varies widely by county, the state Tax Commission says the amount of the scheduled increase does not vary by location. The increase varies only by the value and age of the vehicle.

So, the tag for a 2009 vehicle valued at $20,000 would increase by $135 anywhere in the state, according to a Tax Commission chart released last week.

During a news conference Monday at the Capitol, Bryant stood next to a poster of an oversized Mississippi tag with the word ‘‘RELIEF’’ in the middle and the address for his new Web site at the bottom: ‘‘CarTagRelief.com.’’

‘‘There is some confusion. I had a guy in Meridian say, ’Please don’t pass a bill that’s going to raise my car tag,’’’ Bryant said. ‘‘So, we’re here about trying to let people know the reality.’’

Legislators are not considering any bill that would increase the price of car tags. Rather, the prices are scheduled to increase because of possible legislative inaction.

A slump in car sales is draining a fund that shaves anywhere from a few dollars to a few hundred dollars off the price of the annual tag renewal. The Tax Commission voted last week to reduce the car-tag discount for the year that begins July 1.

“This is the worst thing we could possibly do in these tough economic times,” Bryant said. “We had originally been told it could more than double and could go up to 150 percent. Now we think, depending on if we have any relief, we can hold it this year and next year at its current cost and hopefully the economy will turn around, new car sales will increase and we’ll be able to get back to where we were at.”

Gov. Haley Barbour — who, like Bryant, is a Republican — has said repeatedly that he opposes directly tying a cigarette tax increase to an effort to hold down car tag prices.

Barbour said this month he would agree to a cigarette tax increase that used an ‘‘honest, realistic’’ estimate of how much money the higher tax might generate for the state. His proposed budget assumes a tax of 60 cents a pack. He said any revenue from a cigarette tax increase should go to the general state budget, not to a particular program.

The 1994 Legislature created car tag discounts by increasing the sales tax rate for vehicles. They made a fund to hold a portion of the 5 percent vehicle sales tax. Money from the fund is diverted to counties to replace local taxes lost because of the tag-renewal discounts.

State law says the Tax Commission must set the tag discount rate by May 1 of each year.

Tax Commission spokeswoman Kathy Waterbury said last week that legislators could alter the law to change the May 1 deadline; that would allow the commission to reset the tag discount if lawmakers find a way to pump more money into the tag reduction fund.

Aside from the car tag and tobacco tax, Bryant said lawmakers must also solve the revenue shortfall in Medicaid … something he hopes will happen when legislators return from recess.

“We must have a continuing reoccurring revenue source for Medicaid and we haven’t solved that yet,” Bryant said.

He also thinks the Legislature will find common ground on the cigarette tax. His worry: they have to make sure they’re careful about revenue estimates for the tax.

“I think we’re closer than people think,” Bryant said. “There are clear indicators from other states like Tennessee, who raised it and then had to put on extra law enforcement because people were bootlegging cigarettes. If we raise it above the contiguous average, you’re going to see bootlegging, you’re going to see people going on the internet, going to Indian reservations and anything they can to avoid the state tax. If we’re going to generate revenue, let’s give the people real numbers.”





Associated Press Writer Emily Wagster Pettus contributed to this report.