MS Mississippi State sales tax rates

STATEWIDE SALES TAX RATE

ECONOMIC SALES THRESHOLD

$250,000

TRANSACTIONS THRESHOLD

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Do you need to collect sales tax in Mississippi?

You’ll need to collect sales tax in Mississippi if you have nexus there. There are two ways that sellers can be tied to a state when it comes to nexus: physical or economic. Physical nexus means having enough tangible presence or activity in a state to merit paying sales tax in that state. Economic nexus means passing a states’ economic threshold for total revenue or the number of transactions in that state.

Do you have physical nexus in Mississippi?

Mississippi considers a seller to have physical nexus if you have any of the following in the state:

Owns an office or place of business
Has employees or agents of the business who service customers in Mississippi or solicit or accept orders for merchandise

Do you have economic nexus in Mississippi?

Effective December 1, 2017, Mississippi considers vendors who make more than $250,000 in the prior 12 months in the state to have economic nexus. This means the state considers these vendors obligated to collect sales tax from buyers in the state.

Is what you’re selling taxable?

Services in Mississippi are generally not taxable. However – if the service you provide includes creating or manufacturing a product, or installing or repairing a product you’ve sold, you may have to deal with the sales tax on products.

Tangible products are taxable in Mississippi, with a few exceptions. Products that have exemptions from sales tax include certain prescription medicine, medical devices, and items used in manufacturing.

Is SaaS taxable in Mississippi?

SaaS is non-taxable in Mississippi.

Collecting Sales Tax

The sales tax rate you collect in Mississippi depends on whether you are based in Mississippi or out-of-state.

How to Collect Sales Tax in Mississippi if You are Based in Mississippi

Mississippi is an origin-based sales tax state. So if you live in Mississippi, collecting sales tax is fairly easy. Collect sales tax at the tax rate where your business is located.

For example, Jackson, Mississippi has a 1% local sales tax rate, which combined with the state tax rate of 7%, results in a total sales tax rate of 8%.

If you have more than one location in Mississippi, then you would base the sales tax rate you charge on the point of origin of your sale.

How to Collect Sales Tax in Mississippi if you are Not Based in Mississippi

If you are based outside Mississippi, but have sales tax nexus and are required to charge sales tax in Mississippi, you are a “remote seller” and only required to charge “use tax.” Use tax is very similar to sales tax except that it’s charged by remote sellers. Mississippi’s use tax rate is 7%. The state sales tax rate is also 7%.

Should you collect sales tax on shipping charges in Mississippi?

As long as the item you are shipping is taxable, then Mississippi considers the shipping charge a part of the sale and requires that merchants collect sales tax on the shipping charges along with the price of the item.

When are Returns Due?

When you file and pay Mississippi sales tax depends on two things: your assigned filing frequency and your state’s due dates.

How often will you file sales tax returns in Mississippi?

States assign you a filing frequency when you register for your sales tax permit. In most states, how often you file sales tax is based on the amount of sales tax you collect from buyers in the state.

In Mississippi, you will be required to file and remit sales tax either monthly, quarterly, or annually.

Mississippi sales tax returns are always due the 20th of the month following the reporting period. If the filing due date falls on a weekend or holiday, sales tax is generally due the next business day.