House Bill 2 Summary

• Authorizes municipalities to impose a special sales tax of up to 1% on gross proceeds of sales taxed at 7% or more under Mississippi Sales Tax Law, subject to approval by at least three-fifths of voters in a referendum.

• Authorizes counties to impose a special sales tax of up to 1% in unincorporated areas (Section 2), countywide with municipal agreement (Section 3), or in counties with multi-county municipalities (Section 4), each requiring three-fifths voter approval.

• Requires special sales tax revenue be placed in a separate fund and expended solely for capital projects including recreational complexes, libraries, water/sewage systems, streets, and community facilities.

• Permits municipalities and counties imposing the special sales tax to incur debt not exceeding an amount supportable by the tax proceeds, exempt from normal indebtedness limitations.

• Requires the special sales tax to be discontinued once all funded project debt and obligations are paid; permits Department of Revenue to retain 3% of collections for administration costs.