Income tax bill helps top payers

COLUMBIA - Gov. Mark Sanford's plan to reduce the state's income tax rate only helps the top half of taxpayers, South Carolina's chief economist said Tuesday.

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Mr. Sanford's proposal, which is sponsored by House Speaker David Wilkins, R-Greenville, and backed by about 90 House members, would cut the state's top income tax rate to 4.75 percent from 7 percent during the next decade.

"Fifty percent of the taxpayers don't get anything," Bill Gillespie, the state's chief economist, said after the bill cleared a House Ways and Means subcommittee with few questions and no criticism Tuesday.

That chilled Rep. Bill Clyburn's support of the bill. The Aiken Democrat said he signed onto the bill thinking the rates would be reduced for all taxpayers.

"I'm really disturbed by it," Mr. Clyburn said. His average constituent makes less than $12,000 a year - not enough to reap big breaks from the tax cut. Mr. Gillespie said a person with state taxable income of $13,000 a year would get $1 as the rate fell to 6 percent from 7 percent.

State taxable income is the amount left after federal income deductions, such as home mortgage interest and exemptions for children.

John Ruoff, the research director for the public advocacy group South Carolina Fair Share, said the state's top earners benefit more than anyone else. His analysis shows 5,470 of the state's 1.8 million taxpayers reap $89.4 million in tax cuts.

Mr. Clyburn, a Ways and Means Committee member, is deciding whether to pull his name off the legislation.

Rep. Shirley Hinson, R-Goose Creek, was surprised that opponents to the legislation didn't speak at the meeting.

Part of that might be tied to the public notice on the House's Internet site that the bill was coming up for debate. The subcommittee's agenda didn't show up on the site until midmorning Monday. Ms. Hinson, who serves on the subcommittee, said she only learned Monday that the bill was coming up for discussion.

"I think the public should be informed," she said. "That's how we make good decisions."

Mr. Sanford, undeterred by the criticism, was pleased the bill cleared the panel.

He said the bill helps every South Carolinian because it will help create jobs.

--From the Wednesday, February 25, 2004 printed edition of the Augusta Chronicle