The Mississippi House of Representatives passed a bill that would remove income tax from any name, image and likeness (NIL) deals for athletes at colleges and universities in the state of Mississippi on Feb. 25. House Bill 4014 was sent to the Senate on Feb. 26.
The Mississippi state government is attempting to make the state more attractive for college athletes, since athletes’ NIL earnings would not be taxed by their state of residency nor by the state of Mississippi, where their income is made.
This marks a move toward a beneficial relationship between large public universities — namely the University of Mississippi and Mississippi State University — and state government.
However, this is not an uncommon idea. The Arkansas state government recently passed the Arkansas Student Athlete Publicity Rights Act to exempt NIL deals from state tax.
This Arkansas bill also aims to exempt NIL deals from the Freedom of Information Acts, which means that athletes’ NIL deals cannot be made public information.
State Rep. Trey Lamar, R-Senatobia, presented the bill to the Mississippi Legislature, stressing how necessary the bill is for Mississippi schools to remain at the forefront of college athletics.
“There’s other states doing it,” Lamar said. “I believe Mississippi needs to remain competitive in that arena.”
If House Bill 4014 is passed, half of the SEC schools will have either tax exemptions on NIL earnings or no income tax (Ole Miss, Mississippi State, Florida, Arkansas, Texas, Texas A&M, Tennessee and Vanderbilt), providing an advantage over schools from other states that have not followed suit. Recruits will be more willing to play there, since they will retain a larger portion of their NIL money.
While the bill was passed in the Mississippi House 76 to 32, there were still strong dissenters. Rep. Dan Eubanks, R-Walls, supports equal and fair treatment, but he does not support making exceptions for athletes.
“Why would they not be taxed like any other employee?” Eubanks said. “Is the only incentive for us doing this because other states are doing it? I just don’t know why they’re being treated different than anyone else in the world.”
The Mississippi Senate’s decision to pass or reject the House bill could have a major impact on future transfer portal classes.
