A proposal in the Mississippi legislature that would have imposed a 2 percent gross receipts tax on equipment rentals has been defeated after efforts from the Truck Rental and Leasing Association (TRALA) and Mississippi Trucking Association (MTA).
The tax would have applied to any rental agreements with a term of one year or less, according to the TRALA. The proposal, House Bill 1714 did not define or reference an existing definition of “equipment.” Accordingly, HB 1714 would have applied to commercial and consumer motor vehicle rentals and had the potential to affect a broad range of businesses in the trucking industry.
A nearly identical Senate Bill, SB 3176 was also considered by the Mississippi state Senate in February. That version had a 3 percent gross receipts tax but was never brought to the Senate floor for a vote before the deadline to do so passed.
The proposed 2 percent equipment rental tax would have been in addition to the existing 5 percent tangible personal property rental tax, as well as the 6 percent motor vehicle rental tax that the TRALA members operating in Mississippi are already subject to. Passage of HB 1714 would have amounted to a total of 13 percent in gross receipts taxes that TRALA members would have been forced to pass on to their customers.
The TRALA said consumer truck rentals, commercial truck rentals, and even commercial lease agreements for terms of one year or less would have been affected by this tax.
