Sanford rejected the bill on constitutional grounds, but the rejections is long on common sense. The governor's veto of the 20 percent tax cap was based on constitutional provisions that property must be taxed at fair market value, and that votes on such bills must receive a two-thirds majority on a recorded vote. The legislature used a voice vote, the governor says.
Lawmakers overwhelmingly passed the 20 percent assessment cap on the last day of the legislative session in June.
Without the veto, Beaufort County faced a $40 million shortfall in revenue. A cap would have forced the county to refund to property owners who paid too much in taxes, but prohibit raising other residents' taxes to make up the shortfall.
The General Assembly may ultimately override the governor's veto, but before they do, they should keep in mind that such legislation will give well-heeled South Carolinians a huge tax break while placing the burden for the cost of government on back of the middle and poor income earners.
A state chamber of commerce study released in October reinforces the findings of a Clemson University study, that the tax burden will be shifted from the wealthy to the middle class and small business owners.
The state chamber says that data provided by the state departments of Revenue and Education show that the 20 percent assessment cap would affect 82 of 84 school districts. Only Beaufort and Charleston would benefit. The state Index of Taxpaying Ability would send less money to every school district.
As we have said before, a Clemson University analysis of Beaufort County's proposed tax cap said that it would mostly benefits those who own expensive property. If the goal is to help longtime property owners and those on fixed income or in the lower income bracket to keep their homes, a tax cap isn't the to do it. According to the Clemson study, such a law would shift the burden from the highest-valued homes to more modest-valued homes.
The governor was right to reject this legislation. The only question is: What took him so long? Reforms such as the caps proposed in Beaufort County and in the legislature only help those who are well off.