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Mississippi Towns Allowed to Tax Restaurant, Lodging Sales


 Senatobia may levy a tax on restaurant and lodging sales. Voter approval required.

The Mississippi legislature has passed bills that grant two localities the right to levy taxes on restaurant and lodging sales, provided the taxes are approved in local elections.

The City of Senatobia may “authorize [a] tax levy on hotels, motels, and restaurants.” The tax may not exceed 2% “of the gross proceeds of room rentals for each such hotel or motel” or “sales of the restaurant.”

The City of Hernando may “authorize the imposition of a tax on restaurants, hotels and motels.” The tax may not exceed 2% “of the gross proceeds of sales from room rentals for each such hotel” or “sales of such restaurant or business.”

Section 3 of both bills makes it clear that “[b]efore any tax authorized under this act may be imposed, the governing authorities shall adopt a resolution declaring their intention to levy the tax, setting forth the amount of the tax to be imposed, the date upon which the tax shall become effective and calling for an election to be held on the question.” If the towns approve the taxes, you'll read about it here.

Should the voters of Hernando give their approval, the tax will provide “funds to promote tourism and parks and recreation within the city….” Any revenue generated by the tax in Senatobia would be used for similar purposes. The Mississippi Department of Revenue would administer both taxes.

Both acts “shall be repealed from and after July 1, 2017.”

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.