Mississippi Sales Tax 2023 - 2024

Businesses that sell taxable goods or services in Mississippi must collect sales tax and report it to the Department of Revenue.

Whether you have a physical presence in the state or are selling online, Mississippi sales tax compliance is important. The Magnolia State taxes most tangible products and services, but many exemptions exist. Mississippi sales tax rate is 7%, and local taxes can also be applied depending on the delivery jurisdiction. This guide will help you understand how sales tax works in Mississippi and direct you to the right resources for handling your sales tax obligations.

How to Pay Mississippi Sales Tax?

The first step in paying Mississippi Sales Tax is to register for a sales and use tax permit. This is generally done online using the state’s TAP website. Once registered, you’ll need to charge and collect Mississippi sales tax for all eligible purchases. This includes services as well as tangible products. It also applies to shipping and handling charges.

In addition to sales tax, Mississippi has a local sales and use tax. These rates vary by county, and you should check with your local tax officials for more information. If you’re not registering for local taxes, you may be subject to an audit by the state.

The state of Mississippi defines “sales tax nexus” as exceeding a threshold amount, which is $250,000 in annual sales. This is called economic nexus, and it means that your business must collect sales tax on all of its sales in the state. Once you know your filing frequency, it’s easy to calculate how much sales tax you should remit to the state using a tax software solution.

Mississippi Sales Tax Exemptions

Mississippi Sales Tax Exemptions

The state of Mississippi imposes sales and use tax on many items, but there are some exemptions. For example, livestock, seeds, and feed supply sales to farmers are exempt. In addition, certain equipment like industrial machinery and manufacturing components is tax-exempt. Additionally, textbooks for students and school supplies are tax-exempt during the 4-day back-to-school sales tax holiday each summer. Medicines are also tax-exempt, but this includes items that are permanently implanted into the body, such as sutures, bone screws, or pacemakers.

Mississippi Sales Tax Due Dates

If you’re selling to customers in Mississippi, it’s important that you charge the right sales tax rate and file returns and payments on time. Failure to do so can result in penalties and even legal trouble. In addition, the state can share your sales information with other states and assess your customers directly for any uncollected use taxes.

The frequency of your filing obligations depends on whether or not you have physical nexus in the state. Nexus is established when a business has a store location, offices, or warehouse in the state, hires employees there, or stores inventory there. Alternatively, businesses may have economic nexus when they pass a certain threshold for total sales or number of transactions.

You can file returns and payments online through the TAP system, but paper submission is still an option if needed. Returns and payments are due by the 20th of the month for monthly and quarterly filers, and on January 20th for annual filers.

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