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Yahoo
01-04-2025
- Business
- Yahoo
Almost 60% of SC taxpayers would owe more income taxes for 2026 under GOP bill
House Ways and Means Chairman Bruce Bannister, R-Greenville, announces the GOP income tax reform legislation at the South Carolina Statehouse in Columbia on Tuesday, March 25, 2025. (Photo by Travis Bell/STATEHOUSE CAROLINA/Special to the SC Daily Gazette) COLUMBIA — Legislation touted by GOP leaders as making South Carolina's tax code appear more competitive would require most tax filers to pay more initially, according to an analysis by state fiscal experts. Collapsing South Carolina's tax brackets into a single flat tax rate of 3.99% in 2026 would reduce state revenues by $216.6 million overall. But that's done by broadening and shifting the tax burden: 19.4% of filers would owe less in spring 2027, while a whopping 59.4% of filers would owe more; 21.2% would experience no change, according to the fiscal impact report by the state Revenue and Fiscal Affairs Office released ahead of Tuesday's first hearing on the bill. An income tax shift The bill proposes collapsing SC's three tax brackets to a flat 3.99% in 2026. How that would shift the liability for tax filings due in spring 2027: 19.4% would see a collective decrease of $1.16 billion 21.2% of tax filers would see no change 59.5% would see a collective increase of $938.7 million Source: S.C. Revenue and Fiscal Affairs Office The analysis cautions against generalizing: 'The impact on individual taxpayers varies widely within each range depending on the specific tax situation of each tax filer,' reads the seven-page summary signed by the office's director, Frank Rainwater. Still, the report provides hard estimates on how many South Carolina taxpayers will pay more versus less — and the extent of the swings per taxpayers' income levels after all applicable deductions, exemptions and tax credits are applied to reduce their reported earnings. Of the nearly 1.7 million tax filers expected to pay more in state income taxes under the plan, their increase for calendar year 2026 will average $560, with hikes ranging from $98 on the low end of income levels to over $10,000 for taxpayers reporting more than $1 million in adjusted income. That compares to about 550,000 tax filers who will see an average decrease of $2,110. Thanks to a new personal income deduction for low-income earners, several hundred people at the bottom end of the pay scale would see an average decrease of $3,700, while tens of thousands of people reporting $30,000 to $50,000 of income would see a dip of less than $40. On the top end of the scale, roughly 9,900 tax filers reporting more than $1 million would see their income tax liability plummet by an average of $31,000. More people would be contributing to state coffers. Under the proposal, 23% of tax filers would still pay zero in income taxes. But that compares to roughly 45% currently, according to the Revenue and Fiscal Affairs Office. 'Everybody has to pay something — a little something, at least — to be a part of this great state of South Carolina,' Gov. Henry McMaster said last week when the plan was announced. The new personal adjustment would provide a $6,000 deduction for single filers making up to $30,000, then provide some relief up to $40,000 of income. Married couples filing jointly could deduct $12,000 for incomes up to $60,000, with the deduction phasing out at $80,000. Republicans' 'historic' tax-cut plan attempts to give SC competitive edge Still, looking at South Carolinians reporting an adjusted gross income between zero and $40,000, nearly 714,400 tax filers will owe more, while fewer than 20,000 would pay less. The plan accomplishes what Republicans have long wanted: a tax structure that looks to be among the nation's lowest. Collapsing three tax brackets to 3.99% would make South Carolina's flat tax rate the lowest in the Southeast, except for Florida and Tennessee, which don't have a state income tax. In 2022, the Legislature passed a law that phased in a tax cut of more than $1 billion, but it still left the top marginal rate as the highest in the Southeast this year at 6.2%. However, the effective rate — what tax filers actually pay — was among the nation's lowest even before the 2022 law. The bill promises to keep cutting the rate as revenue collections increase. For every year income tax projections rise by 5%, the bill would reduce revenue by another $200 million until the tax rate gets to 2.49%. When and if that happens, then the bill would truly be a tax cut for the overwhelming majority of South Carolinians: More than 77% of tax filers would see a collective decrease in their income taxes of $2.5 billion, compared to tax year 2026; 23% would still see no change whatsoever, but no one would pay more. How many years it would take to get to 2.49% would depend on the economy and income growth. Advocates promise to make the Legislature's ruling Republicans feel the pressure to pass the bill. The state chapter of Americans for Prosperity announced last week plans to launch a 'six figure campaign' urging legislators to approve the plan. The group's marketing push will include mailings, as well as online and radio ads and an 'unmatched grassroots presence' going door to door asking residents to call their legislators. This is a developing story. It will be updated from Tuesday's scheduled hearing before a House Ways and Means subcommittee.
Yahoo
13-03-2025
- Business
- Yahoo
Myrtle Beach's proposed $373M budget includes no tax, business license hikes
PINOPOLIS, S.C. (WBTW) — Myrtle Beach's top administrator is proposing a nearly $373 million budget for 2026 that includes no tax or business license increases. 'This is a good budget. The city is in a very strong position financially,' City Manager Jonathan 'Fox' Simons said to open up a three-day retreat at the Wampee Conference Center in Pinopolis. If approved by the city council this spring, the spending plan would mark a $31 million increase over current levels. State law requires all local governments to approve a balanced budget by June 30 — one day before the new fiscal year starts. Despite keeping taxes flat, Simons' proposed budget does include increases to solid waste, water and sewer and stormwater fees — bumping them up on average between $1.04 and $5.76 a month for residential rates. Simons said the upcoming budget does include some challenges, including meeting the needs of a growing population both within the city and Horry County. Officials saw moderate to no growth in local tourism dollars last year and began this one with lower-than-expected movement. 'The decline that we've seen was in the first three or four months of the fiscal year,' Simons said. 'They have turned a corner, and they are now rising again.' An aging demographic is also a factor. Chris Finney of the state Revenue and Fiscal Affairs Office said the city's goal should be to increase its population of people between the ages of 18 and 64. 'We're going to struggle to find workers. Local areas are going to struggle to find people to take care of the elderly population,' he said. 'There are a lot of people on the sidelines. We need to get them back to work.' City officials have used the Pinopolis venue, located about 100 miles from Myrtle Beach, for budget retreats several times before. Last year, it cost about $14,500 for the 50 people who attended. Mayor Brenda Bethune defended the city's decision to host its budget session two hours away from home. 'We have tried doing it back home, but there's something about this place that when you get here you just decompress, you relax, and we can focus. And this is the type of work that we need to focus on,' she said. 'We want everyone to have a great time when it's time to have a great time but when we're in here, we're in here to work.' News13 will have updates on-air and online about the city's budget retreat. * * * Adam Benson joined the News13 digital team in January 2024. He is a veteran South Carolina reporter with previous stops at the Greenwood Index-Journal, Post & Courier and The Sun News in Myrtle Beach. Adam is a Boston native and University of Utah graduate. Follow Adam on X, formerly Twitter, at @AdamNewshound12. See more of his work here. * * * Skylar Musick is a multimedia journalist at News13. Skylar is originally from Long Island, New York. She joined the News13 team in June 2024 after graduating from Villanova University in May 2024. Follow Skylar on X, formerly Twitter, Facebook, or Instagram, and read more of her work here. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
