Tossing property tax issue back to counties a missed opportunity

April 27, 2006

When it comes to the Senate’s proposal to toss the question of property taxes back to the individual counties, it’s a political game our state shouldn’t be playing. And it’s one in which education will likely be the big loser.

Property tax "relief" is nothing more than a tax swap. What doesn’t come out of the right pocket will come out of the left.
And lest you think only homeowners are burdened (or will benefit) by drastic changes to our property tax system, we doubt that many property owners will lower their rents to Joe and Jane Citizen if their own property taxes are reduced. (Don’t forget that property owners have equity and, if they are still paying on their property, what is essentially middle America’s last real tax advantage, mortgage interest.)

Sales tax for everyone will rise under all current proposals, hurting those who can least afford it, although we acknowledge that a one-half-cent increase is certainly more palatable than two cents. Never mind the result might be removing the sales tax on food. Most grocery stores sell much more than mere sustenance these days. Want to ponder how prices on toothpaste and toilet paper and cleaning supplies might be affected? Again, it’s doubtful anyone is going to lower prices just because the store doesn’t collect sales taxes on food anymore.

In the end, the consumer will always pay. Any reduction in property tax is just going to shift more obligation for revenue to businesses, which will then pass it on to their customers in some way. That additional burden is not exactly business-friendly in a state so hungry for jobs.

But the gist of this economics lesson is that both the House and the Senate are concentrating too much on appeasing the loud voices of those who demand their property tax obligations be eliminated and not listening hard enough to the voices of those who can’t be so readily heard: South Carolina’s children.

We see little way we can eliminate property taxes and still properly fund education, as well as maintain a modicum of local control.

And we fear sending the decision back to individual counties, with the state essentially abdicating its obligations, will pit contiguous counties against each other. Look at it as a gas war, continually lowering and raising taxes based on what the market will bear. (And don’t expect too much of that to be on the "lowering" side of the equation.) Wealthier counties can take care of themselves and their schools and other services while less-wealthy counties will be right back where they started, unable to provide the opportunities their children deserve just as much as do ours in the Upstate.

We’ll breathe a sigh of relief when the legislature realizes that there are a relative few who really need help. Let’s provide that, with a pool of funds for special cases.

We hope, we remain confident, that senators will not react unduly to pressure from any organization that threatens to work against lawmakers or offer up funded opposition to those who don’t conform to their demands. No one in public office should. It may be, as some might say, "just politics."

But it isn’t good public service.

Copyright 2006, Anderson Independent Mail. All Rights Reserved.