Senate panel dismisses House plan shifting taxpayer burden

By Seanna Adcox

The Associated Press

COLUMBIA - A Senate panel decided Tuesday to reject the House version of a proposal to swap property taxes for increased sales taxes and focus on removing school operating costs from all property tax bills.

"From all I've heard, I don't think the House bill is the way to go," said Senate Minority Leader John Land, D-Manning. "We ought to set out on our own course."

The tax substitution plan approved by the House earlier this month would remove most of the property taxes from owner-occupied homes by cutting the operating costs of schools and local governments from tax bills, leaving only local debt.

The state sales tax would be raised from 5 cents to 7 cents to make up the difference.

The measure was a response to homeowners' demands to cut property taxes this election year, when all House members face election and senators don't. Senators have accused the House of quickly passing the bill just to approve some sort of property tax reform before filing for re-election.

The senators want to try to take school operating costs off all classes of property and leave taxes from other local governments on tax bills.

A conference committee likely will have to work out the differences in the House and Senate bills for tax relief to pass the General Assembly this year.

The group NoHomeTax.org wants property taxes eliminated from homeowners.

"Home ownership within our state's borders is facing a crisis," said Dan Harvell, a board member of the organization. "It is as if our homes are ATM machines from which [local governments] can extract money as they choose."

Business owners and the state Chamber of Commerce say the House plan would shift the tax burden to businesses.

"How can we call ourselves business friendly?" Land asked.

The House plan would make South Carolina one of the most expensive states in the nation to do business, with the distinction of being No. 1 nationwide in sales taxes and property taxes on manufacturers, said Burnie Maybank, an attorney representing the state Manufacturers Alliance.

The Senate subcommittee will next meet Thursday.

email this

print this