MS HB1566

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

Requires municipalities to adopt a resolution declaring their intention to levy the tax, specifying the capital projects to be funded, and publish notice of the referendum for at least three weeks before the vote.

Permits tax revenue to fund capital projects including recreational complexes, senior centers, community centers, auditoriums, libraries, streets, water and sewage systems, gas lines, and multipurpose buildings, with approval from the Mississippi Development Authority.

Allows municipalities to incur debt not exceeding the amount that can be funded by special sales tax proceeds, separate from general municipal debt limitations, with any tax automatically discontinued upon project completion or after 10 years unless reapproved by voters.

Department of Revenue collects the tax and retains 3% of proceeds for collection costs, with remaining revenue placed in a separate municipal fund exclusively for capital project expenses.