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Changes to existing taxation could help solve the problem

Property tax cannot be changed in a vacuum

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To hear legislators tell the story, property tax will be reformed in the General Assembly next year, one way or another.

Something must be done, they say, because soaring property values are slamming residents, particularly longtime coastal residents, with property tax bills that are out of balance. Property values -- like gas prices -- seem to have taken on a life of their own. And for many people, that life has nothing to do with the real world of a stagnant income.

But the public -- and the General Assembly -- must remember that there is no free lunch. The Statehouse is not the Magic Kingdom. There is no wand that can be waved over the complex system of taxation -- or the market-driven property values -- to ease all pain and make everyone live happily ever after.

If property taxes are limited, the money towns, counties and school districts need to provide services must come from somewhere else. The most likely candidate seems to be the sales tax. But the sales tax is regressive. And the sales tax already is a work horse in funding public education and much-needed local capital improvements.

Before the balance between sales, income and property taxes is destroyed, it would be smart to look at different ways of approaching the existing system.

For example, the state gives up millions of dollars each year through a long list of sales tax exemptions. Each of them should be looked at for potential change. Perhaps cutting back on the exemptions could bring in enough money to fund public education without using the local property tax. Property taxes are rising, in large part, because they pay for a big part of the public school costs.

As for the property tax, the state should clamp down on the "agricultural" designation that gives so many non-farmers big tax breaks.

Perhaps property assessments could be done more often so the big spikes are leveled out.

South Carolina may need to take another look at "circuit-breakers" on property taxes, which can provide relief to those who need it most.

It has been suggested that the state follow Florida and tax intangible personal property, such as stocks and bonds.

Legislators say all options are on the table, and that is good. If native South Carolinians are driven off their property because of the property tax, nobody wins. But whatever is changed, it must be done in accordance with the state Constitution, which insists on the equity of property taxes based on fair market value. And it must be done with all revenue streams in mind, not just the property tax.