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Editorials - Opinion
Saturday, May 20, 2006 - Last Updated: 7:00 AM 

Heed governor on taxpayer relief

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Gov. Mark Sanford hasn't been able to make much headway for tax cuts inside the Statehouse this year, so he's taking his campaign to the people today. A tax-cut rally on the Statehouse steps isn't designed to confront legislators, who will be in recess for the weekend. (They have shown themselves to be unduly sensitive to the governor's previous public efforts on behalf of government frugality.) But the rally should help get his message across: With all of the new revenue that is piling up in the state Treasury, taxpayers deserve more consideration.

The governor's proposal comes in the wake of more good news on the revenue front from the state Board of Economic Advisors. This week the board estimated that the state will receive another $180 million in new revenue this year. Altogether, revenues will have increased by about $1 billion, the governor estimates.

At the start of the budget process, he urged, to no avail, that the Legislature come up with a plan to return some of the new revenue to the taxpayer. He has recommended a spending cap of 5.6 percent that would enable the state to return $290 million to the taxpayers on a recurring basis. Instead legislators have chosen to increase spending by double digits.

"While rising revenues may be a good indicator of our steadily improving economy, nearly 1 billion new dollars, a 16.7 percent growth, is far more than state government needs to provide core services. This growth represents roughly three times the amount that the average family's income grew last year," the governor wrote in a letter to legislative leaders this week.

With news of even more new revenue than earlier anticipated, the governor now is proposing that the House scrap any proposed increase in the state sales tax for property tax relief and use instead the new revenue dollars. "We have a chance to return hundreds of millions to the taxpayers of this state as new revenues pour into Columbia - I encourage you to take it in the form of property tax relief," he wrote.

The House and Senate have been far apart in their approach to the property tax relief issue and it's by no means certain that any agreement can be reached this year. But clearly, as the governor noted, in view of the growth in revenue, swapping an increase in the sales tax for property tax relief should be off the table.

The state budget remains in conference committee and legislative leaders still have time to take advantage of the state's suddenly rosy economic situation and provide some measure of tax relief. Meanwhile, they should restrain the impulse for a sharp increase in governmental spending.