Hurricane Katrina: Relief Debit Cards Subject to Sales Tax

Debit cards are being issued by the federal government, Red Cross and other groups to Hurricane Katrina evacuees for emergency relief. These cards can be used by the holder to make retail purchases of items such as food, clothing and gasoline.

Purchases made using these debit cards are taxable for sales tax in Mississippi Section 27-65-105(a), Mississippi Code of 1972 requires that sales of property or services must be sold to, billed directly to and payment must be made directly by the governmental entity for the sale to be exempt from tax Mississippi sales tax must be charged on purchases unless the property or services being purchased is specifically exempt, such as gasoline.​​

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