The Mississippi House has rejected a bill to let businesses pass some tax breaks to individual employees.
House Bill 1264 needed 71 votes, but only got 67.
House Ways and Means chairman, Jeff Smith, says he plans to bring back the bill to try to pass it.
Democrats objected to the expense, and to letting businesses choose employees to get credits.
Estimates show the change would cost the state up to $6 million yearly.
Mississippi businesses can get state corporate income tax credits for creating jobs. But many firms can't use all credits, because businesses are often unprofitable during expansion.
Chosen employees would receive minimum credits of $250, deductible dollar-for-dollar from state income taxes.
Officials say the credit would help Mississippi compete with Tennessee, which has no state income tax.
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