JACKSON, Miss. (WLBT) - You may not think much about that 7% sales tax tacked onto every purchase in Mississippi or even where it’s going, but much of it is bolstering the state’s budget.
“We typically see a spike every year after the holiday season in the cash that comes in in January," explained Mississippi Department of Revenue Business Taxes Director Lanell Strait. "So, last year at this time, we did see about a 12 percent increase over the monthly average for the calendar year of 2018.”
Once upon a time, Mississippi was losing out on some revenue when you logged on and clicked your way to a new purchase. But as of this year, a portion of the tax collected from your online purchases has a specific destination.
“It’s not just about what we purchase locally now, because what we are getting through the online sales is now also being diverted and that will boost the infrastructure spending for cities, counties for roads, bridges and for city water systems,” explained Strait.
It helped level the playing field for small businesses when the seven percent was tacked on to online sales like those from Amazon. Still, the owner of James and Leigh in Clinton says they’re in constant competition.
“You see big box retailers closing everyday," said James and Leigh owner Anna Nutt. "So, it’s scary to be a small business owner and think if those big box stores are closing, it could happen to us. So, it’s very important that when you’re thinking about your Christmas gifts that you shop local in your community and support those people who want to be part of your community.”
They make it a point to let customers know they can still get online orders to them quickly. They give it a small business touch by adding a handwritten thank you note with every order shipped and their bottom line is anchored by the holiday season.
“It makes up a huge chunk of our sales each year," noted Nutt. "December we should always, almost, always hit our mark. It might be a little under but we always know December is going to be a great month of sales.”
The Mississippi Department of Revenue commissioner says he’s anticipating a strong holiday season for retail sales and says that’s due in part to the strength of our national economy.