Senators introduce property tax cut bill

COLUMBIA, S.C. - State senators retooled a property tax reduction plan so that it wipes out taxes on homes and cars.

The plan Sen. David Thomas, R-Fountain Inn, introduced Thursday raises the state's sales tax to 7 cents on the dollar, up from a nickel now. That extra $1 billion in sales tax collections would replace local property tax collections to pay for county, city and school operations. It depends on voter passage of a referendum in November.

Thomas said counties wouldn't lose money and their budgets would increase over time because sales tax collections rise.

People are being taxed out of their homes and cars and trucks through regular property tax reassessments, Thomas said.

He said the state's real estate markets could collapse during the next two decades if that doesn't stop.

The House Ways and Means Committee passed two bills Wednesday dealing with reassessment. One caps reassessments at 15 percent. The other prevents reassessment until property is transferred to someone other than a spouse or sold.

While that's helpful, "this is the whole enchilada," Thomas said.

Tax bills would nearly disappear next year if voters approved, Thomas said. Taxpayers would continue to repay bonds owed by local governments and schools.

House members have proposed other plans to raise the sales tax and cut property taxes. On Tuesday, Gov. Mark Sanford and House Speaker David Wilkins unveiled a plan to cut the state's income tax during the next decade.