Mississippi’s secret plan to raise taxes

Recently, while most Mississippians were busy working, raising families and just trying to get by, the state of Mississippi held a little-noticed hearing to consider imposing taxes on a significantly larger number of our citizens.

This occurred after the Mississippi Legislature had already left town, leaving no opportunity for our elected officials to publicly debate this important issue at the state Capitol or cast votes on it. Rather, as has unfortunately become a fact of life in our day and age, unelected bureaucrats in a state government agency, with little fanfare and even less explanation, began a process to expand regulations that will require many Mississippians to pay more taxes with minimal public input and even less accountability.

A few months ago, the Mississippi Department of Revenue filed a notice with the Secretary of State’s Office signaling it would be amending several of its regulations. One of these would expand the definition of hotels and motels to include rooms in people’s homes, as listed on popular websites such as Airbnb or VRBO. Another would expand the application of local tourism taxes.

These proposed changes come on the heels of an attempt by DOR earlier this year to require out-of-state companies to collect sales tax on internet purchases by Mississippians, despite the fact that the U.S. Supreme Court has clearly stated this is illegal and DOR’s own commissioner has admitted it was “probably unconstitutional.”

State law requires the Revenue Department to timely notify the public of proposed rule changes. It did not do so. State law also requires it to issue a statement showing the impact on the economy of proposed rules. Again, it failed to do so. State agencies are required by law to prepare such economic-impact statements when adopting significant amendments to regulations. However, in the 11 years since such statements have been required, the Revenue Department has never issued one.

The most troubling aspect of all of these proposed regulations is DOR’s actions represent a trampling of the doctrine of separation of powers in our form of government. This unelected bureaucracy is unconstitutionally commandeering authority from our legislative branch to make laws, rather than simply implementing them.

Regarding DOR’s proposed tax on people’s homes, bills were introduced in both houses of the Legislature during the 2017 session to change the definition of hotel and motel under the local tourism tax to include short-term rentals of residential properties.

None of these bills became law.

Despite our elected representatives choosing not to change the law, this unelected state agency is now attempting to legislate by regulation. The same thing happened with internet taxation, as the Legislature considered and rejected changes to state law to allow DOR to tax out-of-state sellers such as Amazon. Again, notwithstanding our elected officials opting not to enact such a law, DOR is proceeding with regulations to do it anyway.

This silent and gradual encroachment into our lives by an unelected and unaccountable Fourth Branch of government is deeply troubling for our form of government and the future of liberty. This governing by regulation is not what our Founders intended; not what was written into our Constitution; and not what our government was built upon. Our elected officials need to step up and put a stop to this regulatory tyranny. But we the people also need to let our voices be heard by getting more involved in the rulemaking process and challenging bad rules in court. The only way unaccountable agencies are going to change is if we make them do so.

This story was originally published May 21, 2017 at 5:00 AM with the headline "Mississippi’s secret plan to raise taxes."