AN ACT TO AUTHORIZE THE GOVERNING AUTHORITIES OF THE TOWN OF ACKERMAN, MISSISSIPPI, TO LEVY A 2% TAX UPON THE GROSS PROCEEDS OF SALES OF RESTAURANTS FOR THE PURPOSE OF PROVIDING FUNDS TO PROMOTE TOURISM AND PARKS AND RECREATION WITHIN THE TOWN; TO REQUIRE THAT AN ELECTION BE HELD ON THE QUESTION OF WHETHER SUCH TAX MAY BE LEVIED; AND FOR RELATED PURPOSES.
SB 3401 authorizes the Town of Ackerman, Mississippi, to levy a local sales tax of up to 2% on the gross proceeds of restaurant sales. The stated purpose of the tax is to generate revenue for tourism promotion and for parks and recreation within the town. The bill defines the restaurants and food service establishments covered, and it excludes schools, hospitals, nursing homes, and similar facilities that serve patients, students, or families.
Before the tax can be imposed, the town’s governing authorities must adopt a resolution, publish notice, and hold a local election. The tax may be levied only if 60% of the qualified electors voting in the election approve it. If approved, restaurants must collect the tax at the point of sale, and the Mississippi Department of Revenue will administer collection and enforcement in the same manner as state sales taxes. The revenue must be deposited into a special fund, kept separate from the town’s general fund, audited annually, and used only for the purposes stated in the act. The authority to levy the tax is temporary and is repealed effective July 1, 2030.
The bill creates a new local taxing authority for the Town of Ackerman by allowing it to impose a dedicated restaurant sales tax, subject to voter approval. It affects restaurant operators and consumers within the town limits, while excluding certain institutional food service providers. It also incorporates state tax administration provisions by directing the Department of Revenue to collect and enforce the tax under Chapter 65, Title 27, and requires separate accounting, annual independent audits, and restricted use of the proceeds for tourism and parks and recreation.
The bill appears to have broad support and little visible opposition. It passed the Senate 51-0 and the House 109-1, indicating strong bipartisan approval in both chambers. The available record does not include committee debate or public testimony, but the voting history suggests the measure was viewed favorably as a local revenue tool for community amenities and tourism promotion.
The main policy issue is the imposition of an additional tax on restaurant sales, which may be of concern to restaurant owners and consumers who would bear the cost. Another point of potential contention is the requirement that 60% of participating voters approve the tax before it can take effect, reflecting a safeguard against local opposition. Because the tax revenue is restricted to tourism and parks and recreation, any disagreement would likely center on whether those uses justify a targeted tax on a specific industry rather than on general municipal funding.