Thomas proposes elimination of car, property taxes

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Thomas, a Republican who chairs the Senate Banking and Insurance Committee, would not say where the money will come from or release other details of the plan before next week. Thomas proposed last year that lawmakers raise the sales tax by two cents to end taxes on vehicles and homes.

"The whole thing has completely gotten out of hand," he said Friday. "The bottom line is as people see their ad valorem or property taxes go through the roof with increases in assessments and increases in car values, the taxes seem to be disproportionately going beyond people's incomes."

Thomas said his plan would eliminate taxes on owner-occupied homes and personal cars and trucks within a year of passage. An official estimated last year that raising the sales tax by two cents would produce slightly more than $1 billion.

Rep. Gilda Cobb-Hunter, an Orangeburg Democrat who sits on the House budget-writing committee, said one of her chief concerns is that any tax-relief plan address what impact it will have on local government and school operations so that "it doesn't result in an unstable source of revenue for funding schools."

Residents were pleased by the prospect of a tax cut, but the proposal faces questions about its impact.

"I'll take tax relief wherever it can come from," said Barry Cannon, of Greenville "I think we're taxed enough already."

Steve Martin, of Greenville, shares that sentiment.

"I can't object to no property tax or car tax," he said. "I don't know how that would be made up for — I'm not a big spender, so that might not be a bad thing. But, as far as flat out no property tax and no vehicle tax — that's fine!"

Thomas said he believes the proposal has the support of the majority of Senate Republicans and can be passed if it gets out of committee.

But other lawmakers, Democrats and Republicans, voiced concerns Friday over the proposal, which must compete with at least two other plans for cutting vehicle and/or property taxes.

House Majority Leader Rick Quinn, who has helped craft a tax reform proposal which removes some sales tax exemptions, said Thomas' plan, while similar, would shift the tax burden to business and would not address the issue of education inequity between affluent and poor school districts.

"He totally exposes business," Quinn said. "In the future, business will be totally responsible for all functions for local government. And part of the problem is we have one of the highest taxes on vehicles as well as on business. My plan would affect both."

Greenville resident Catherine Stevens is a little skeptical.

"Politicians like to make promises — I want them to know how they're going to pay for something before they make promises," she said. "A lot of times when they say 'We're going to do this way and I have it all figured out' — those numbers are so big — some of them might think the money's abstract because it's not hurting them."

Cobb-Hunter also said she is unconvinced that citizens are demanding the elimination of car taxes, which lawmakers have already reduced in the last decade.

"I don't know that there is a groundswell out there," she said.

Sen. John Land, a Manning Democrat who sits on the Senate Finance Committee, said whatever Thomas' plan contains, debate about such plans should force lawmakers to examine if their priority is cutting taxes instead of providing services.

"With the coffers of government so dry and needs so great, I don't see anything passing that doesn't somehow address our deficits such as education," Land said. "If we're going to give any tax breaks to anybody, we're just going to have to make a policy decision that that's our interest, that's our top priority."

Technically, the Legislature cannot eliminate all property taxes. Cities, counties and school districts are allowed by the state Constitution to levy property taxes to repay debt, such as bonds for school construction. But legislators can eliminate by statute the taxes currently levied for operations of schools and local government.

Thomas said lawmakers might choose one of the other tax relief plans. But he said he thinks citizens will like his proposal.

"Ultimately, I think people will be happy with the kind of tax relief we're bringing to them under our proposal," he said. "In fact, I would think they would be ecstatic about it."

Staff writer Jolene Gatas contributed to this article.