Posted on Thu, Sep. 29, 2005
EDITORIAL

Property Taxes Hard to 'Repair'
Local legislative hearings great, but changing the law is a huge challenge


Aggrieved local property owners are sure to share their unhappiness about real estate taxes at hearings next month to be hosted by two local members of an S.C. House special taxation committee. These folks object that the rising market values of their homes fattened their tax bills after last year's property reappraisal.

They no doubt will tell the legislators - Reps. Tracy Edge, R-North Myrtle Beach, and Vida Miller, D-Pawleys Island - that the General Assembly must - must - lift this added burden off their shoulders. But in the end, we fear, neither legislator will be able do much to ease these good folks' pain.

The state's tax system is grounded in the constitutional principle that taxes should apply uniformly to all taxpayers. That's why the market value of a given property is tied to its tax value: Folks who own highly valued property should pay higher taxes than folks whose property is worth less.

If you hold the owners of fast-appreciating property harmless from higher tax bills, as some legislators propose, you're transferring the tax burden they're no longer carrying to all other property owners. Municipal and county councils, as well as local school boards, set their tax rates at whatever level is required to bring in the tax revenue they need to operate their governments. If some property owners don't pay as much as they should, other property owners pay more.

Some legislators think the answer to easing the pain of the aggrieved lies in a constitutional amendment making property taxation just a little bit nonuniform. Perhaps, they think, it would be OK to bar S.C. counties from reappraising property until the owner sells it. Not so. Such a change could mean that someone who's lived in a house for years would pay much lower property taxes than his neighbor who just moved in to an identical house next door. Labeling disparate tax burdens "constitutional" wouldn't make them fair.

Still another idea circulating among Columbia savants is ratcheting down - or even eliminating - property taxes while raising the sales tax to make up for the lost revenue. Bad idea.

This state applies the sales tax to food, which everyone, rich and poor, must have. Under this scenario, the poor would end up paying proportionally higher taxes than middle- and upper-class earners - again, not fair.

Legislators could correct that problem by exempting life's necessities from the sales tax, but that would reduce the revenue the tax brings in, requiring legislators to raise sales tax rates to make up for what is lost. That, in turn, would make the sales tax into punishment of consumption - a bad idea in a state that stakes its economic health on tourism. It's foolish to discourage visitors from spending money while they're here.

None of this is to suggest that the Miller and Edge hearings next month are exercises in futility, only that fixing what some folks perceive to be wrong would create new inequities. S.C. legislators know this, which is why we continue to suspect that their motivation in investigating this issue has more to do with politicking than with improving public policy.

Hearings' times and places

Miller is hosting a property tax hearing at 5:30 p.m. Tuesday in the main courtroom of the Georgetown County Courthouse. Edge will host a hearing in North Myrtle Beach City Hall, with the time and date to be announced.





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