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Yahoo
5 days ago
- General
- Yahoo
24-year-old city council member wins SC House race
The view of the state House chamber from the gallery on Tuesday, Jan. 9, 2024. (File/Travis Bell/STATEHOUSE CAROLINA/Specia to the SC Daily Gazette) A 24-year-old Bishopville City Council member will be the newest legislator at the Statehouse. Democrat Keishan Scott cruised to victory Tuesday over former Sumter County GOP chair Bill Oden. Scott received almost 71% of less than 3,700 votes cast in a special election for a state House seat representing all of Lee County and parts of Kershaw and Sumter counties, according to unofficial results from the state Election Commission. 'This victory is not mine alone, but it belongs to all of the people … that got out and exercised their right to vote,' Scott said to cheers at a victory speech broadcast on his Facebook speech. Scott is the youngest person to be elected to the Statehouse since Rep. Brandon Newton, a Lancaster Republican, won as a 22-year-old in 2016. But the youngest person in at least modern times to be elected to the Legislature is former Sen. Sherry Shealy Martschink. The Mount Pleasant Republican was elected to the House in 1970 during her junior year at the University of South Carolina, only 14 days after her 21st birthday. Scott, who won his first election to city council in 2023, will take over the seat vacated by Rep. Will Wheeler, a Bishopville Democrat who announced his resignation in January, just three days into this year's legislative session. His surprising resignation left the rural district without a representative for the entirety of this year's session. 'I can promise you that every day I go into the Statehouse, I will carry the people with me,' Scott, a preacher, said to the crowd moments before leading a prayer. 'Because certainly, it's about people more than politics.' The election means nothing changes with the Republicans' supermajority advantage in the House. But it does restore the number of Democrats in the 124-member chamber to 36. Wheeler ran unopposed in four of his five elections. The only time he faced GOP opposition was in 2022, when Republicans gained supermajority status in the chamber. The 2024 elections gave Republicans a supermajority in the Senate too. Oden, who recently concluded four years as head of the Sumter County Republican Party, said in a text to the Daily Gazette he 'lost tonight' but 'had a ball running.' 'God has something better in store for me,' he added. Scott's victory ensured the Democratic Party didn't lose another seat in the Statehouse. In an endorsement video posted on Scott's Facebook, U.S. Rep. Jim Clyburn emphasized Tuesday's election was a must win for Democrats. Electing Scott 'will be the beginning of a Democratic comeback here in South Carolina.' Clyburn said. 'Irrespective of where you live, how old you may be, whatever gender you may be, this is about the future of Democrats in South Carolina.' Lee County had issues with counting votes in November's election and recount for a state Senate race that ousted Hartsville Democrat Gerald Malloy, who ultimately conceded ahead of his scheduled challenge. The state Election Commission sent staff to Lee County to help during the primary, as well as Tuesday's special election, commission spokesperson John Catalano told the SC Daily Gazette. In April's primary, Scott defeated Carl Whetsel, a retired chiropractor and Bishopville City Council member, by 11 votes after a recount. In the unofficial count done days before, Scott only won by 10 votes. An automatic recount was required under state law since the winning margin was less than 1%. With Tuesday's landslide victory, he can officially focus on making a difference in Columbia next year. 'Your vote of confidence,' he said to the crowd, 'it means the world to me.'
Yahoo
30-04-2025
- Business
- Yahoo
House GOP advances new plan for SC income taxes that has fewer paying more
House Ways and Means Chairman Bruce Bannister, R-Greenville, announces the GOP income tax reform legislation surrounded by House and Senate Republicans at the South Carolina Statehouse in Columbia on Tuesday, March 25, 2025. A new proposal April 30, 2025, would raise income taxes for fewer people than the original. (Photo by Travis Bell/STATEHOUSE CAROLINA/Special to the SC Daily Gazette) COLUMBIA — A tax restructuring plan that would increase income taxes for about a quarter of South Carolina filers and cut them for more than 40% advanced Wednesday in the House. While the plan is expected to clear the House in the session's waning days, the Senate's highly unlikely to take it up. That means the only change in the tax code this year will be a state budget that shaves $290 million in revenue — fulfilling the final cut of a 2022 law. Tax change impacts In the first year of the proposed change, the shift in liability would cause: 42% of tax filers to pay, on average, $488 less 24% of filers to pay, on average, $266 more 33% of filers to see no change Source: S.C. Revenue and Fiscal Affairs Office House Republicans hope sending the tax restructuring plan over to the Senate next week will enable it to reach Gov. Henry McMaster's desk early in 2026 — in time to be included in the next budget process. Republicans have long wanted to reduce the state's top marginal rate to make South Carolina appear more competitive. With the soon-to-be 6% rate still the Southeast's highest — even though the effective rate is about half that — Republicans contend the state needs to bring it down to keep attracting companies and their executives. The House's chief budget writer said it's about removing the 'sticker shock' for businesses. 'We looked out of line with the way we treat our actual tax base,' said Ways and Means Chairman Bruce Bannister. But Democrats question the need altogether, noting the existing tax structure hasn't hindered South Carolina from being one of the nation's fastest-growing states. 'If we are competing for people, we are certainly winning,' said House Minority Leader Todd Rutherford, D-Columbia. 'The question then lies, who is it that we are competing for that we're not winning? And why is it that we're not winning?' The proposal approved Wednesday by the House Ways and Means Committee on a mostly party-line 17-6 vote is very different from what was initially announced a month ago by GOP lawmakers with much fanfare. After an analysis showed 60% of tax filers would pay more, the pushback prompted House Republicans to put their bill on hold and ask the state's fiscal experts for a review of options. 'When you get resistance like that, you pack up and try a different path,' said Bannister, R-Greenville. The new plan selected by his committee no longer moves immediately to a single, flat tax rate (which the bill did as introduced). Rather, it collapses the state's three tax rates into two — eliminating the bottom rate, which resulted in zero taxes paid, and reducing the top two tiers. Another reason Republicans give for restructuring the tax code is that it results in 44% of tax filers paying zero state income taxes. Meanwhile, 10% of filers pay for 65% of the state's total income tax collections. Republicans say that's inherently unfair. 'Let's have a larger percentage of people paying, and let's lower the burden on everybody,' Bannister said. Under the changes advanced Wednesday, more than one third of tax filers would still pay zero income taxes. As the original bill did, the amended version would decouple South Carolina's income tax code from the federal system. By being one of just five states to tax 'federal taxable income,' South Carolinians start their state tax forms with less income to tax, compared to what they'd file if they lived across the state border. Taxing adjusted gross income as most states do would make South Carolina's taxes truly comparable to its neighbors. Republicans contend it would also put South Carolina back in control of state tax collections, instead of being tied to the whims of Washington politics. Under the proposed two-tier plan, taxpayers would pay 1.99% on the first $30,000 of their taxable income, after all applicable state exemptions and deductions are taken. Every dollar after that would be taxed at 5.39%. The plan would reduce tax collections overall by $400 million in year one — almost double what the initial bill would have done. Republicans said that will only reduce anticipated increases in revenues. They contend no cut in state services would be necessary. The plan calls for eventually reaching a single tax rate of 1.99%. Potential annual cuts would depend on estimated income tax collections rising by at least 5%. Doing so slowly rather than all at once is expected to cause less of a tax shift. It's impossible to make structural changes to the tax code without creating winners and losers, said Frank Rainwater, director of the state Revenue and Fiscal Affairs Office, which makes the revenue projections legislators use in crafting a state budget. 'There's a consequence for every action you make,' Rainwater told the committee. The bill still calls to eventually eliminate income taxes at some point. Members of the uber-conservative Freedom Caucus have called for immediately eliminating income taxes. But that would require slashing state spending by nearly half. Last fiscal year, income tax collections totaled $6.1 billion, accounting for nearly 45% of the state's general fund revenues, according to the state's fiscal experts. Rep. Brandon Newton, chairman of Ways and Means' tax policy subcommittee, said phasing in cuts based on projected revenue increases will avoid cutting essential services. 'This is, in my mind, a responsible way to get rid of the income tax and, in reality, the only rational way to get rid of the income tax,' said the Lancaster Republican. Of the seven Democrats who sit on the Ways and Means Committee, only one voted to advance the plan: Rep. Leon Stavrinakis of Charleston, who chairs the economic development subcommittee. Rep. Gilda Cobb-Hunter, the longest-serving legislator in the House, said if the state's tax code is really making business executives hesitant about locating here, then the problem might be marketing, not the tax structure itself. She cautioned against pushing through a major change that might result in unintended consequences. 'I just think there are a lot of implications that we may or may not be thinking about,' said the Orangeburg Democrat, who's also first vice chair of Ways and Means. She again pointed to the state's last huge tax swap as a cautionary example. The 2006 law known by its number, Act 388, increased the state sales tax by a penny on the dollar to reduce homeowners' property taxes, creating a host of unintended consequences for real estate, business property taxes, and school district budgets that Cobb-Hunter said they're still feeling two decades later.
Yahoo
09-04-2025
- Business
- Yahoo
State lawmakers should not cut taxes and here's why
House Speaker Murrell Smith during a press conference about income tax legislation at the South Carolina Statehouse in Columbia, S.C. on Tuesday, March 25, 2025. (Photo by Travis Bell/STATEHOUSE CAROLINA/Special to the SC Daily Gazette) A camel, it has been said, is a horse designed by a committee. A committee of state GOP leaders recently designed a 'historic' income tax-cut plan. But what they delivered was a camel: lopsided, ungainly, and reeking of a bad attitude. Worse, they put the cart before the camel, announcing the tax-cut plan with much ballyhoo and bunkum before realizing that it doesn't cut taxes for most South Carolinians. It actually raises taxes for 60% of South Carolinians (or nearly 1.7 million tax filers) for tax year 2026, as per estimates released by the state Revenue and Fiscal Affairs Office a week after the big announcement. The bill includes huge tax cuts for some, but those cuts overwhelmingly benefit the wealthy. Roughly 9,900 tax filers with more than $1 million in income would see their taxes cut by an average of $31,000, according to reporting by S.C. Daily Gazette Editor Seanna Adcox. Many others would get little or nothing. The bill was supposed to be fast-tracked for approval, but now House leaders have postponed debate while they explore other options. No, I'm not making this up. This was a hugely embarrassing episode of DOGE-level ineptitude by the people who are supposed to be leading our state. At least the bill was shelved for the moment. But Rep. Brandon Newton, chairman of Ways and Means' tax policy subcommittee, said Republicans remain 'committed to passing income tax reform this year.' That means another tax-cut camel may soon be galumphing along the dusty road to the Statehouse. Whatever rough beast emerges out of ongoing discussions, the General Assembly should reject it. State lawmakers should not cut taxes. The postponed bill slashed taxes by more than $200 million, with a provision to cut $200 million in taxes every year when revenue projections rise by 5%. A revised bill might cut taxes by that amount as well. We simply can't afford that. Our state has too many critical needs that should be addressed right now, including infrastructure, education, health care, crime and public safety. We should remember that the General Assembly just cut taxes over the past few years by a whopping $1 billion, on top of sending $1 billion back as rebates in 2022, limiting the ability of lawmakers to deal effectively with the state's top needs, such as fixing our notoriously awful roads. A bold new plan called Momentum 2025 offers great hope for upgrading our roads, but it carries a price tag of $1 billion a year. There's no plan, however, to fund Momentum 2025, as Adcox pointed out in an excellent commentary tracing the history of our road woes. The state faces other critical concerns, such as the teacher shortage that results in potentially thousands of South Carolina students beginning each school year without a fully qualified teacher in the classroom. We've got dire healthcare challenges in South Carolina as well. An estimated 521,660 South Carolinians under age 65 lack health insurance, according to data from the U.S. Census Bureau. We should follow the lead of 40 other states in expanding Medicaid, drawing down billions in federal funds and investing some state money to provide health care coverage for an additional 360,000 low-income South Carolinians. In addition, with Medicaid threatened by cuts on the federal level, state lawmakers may need to step in to protect South Carolina's most vulnerable citizens. South Carolina also needs to invest more in children, especially in the areas of prenatal care and childcare. South Carolina ranks near the bottom of the nation for child care affordability. Overall, our state ranks among the worst in the nation for the well-being of children, according to the annual Kids Count. The S.C. Department of Juvenile Justice, meanwhile, has been plagued by overcrowding and other unsafe conditions. South Carolina desperately needs to invest more in law enforcement as well. Our state has one of the highest murder rates in the nation and one of the highest rates of fatalities on the road, which includes one of the highest rates of drunken driving deaths. One study called South Carolina 'the most dangerous state for drunk driving in America.' A tax cut doesn't solve those problems. And state lawmakers have made big new promises to South Carolinians this year, including plans to spend $60 million that we can't afford on school vouchers. You can bet Republicans will want to spend a lot more on that in the future as well. Lawmakers who support a big tax cut argue that it's needed to keep South Carolina growing, but that's not a problem. We're already one of the fastest-growing states in the nation. Finally, it would be irresponsible to cut state taxes with the U.S. economy in a tailspin as the stock market and consumer confidence plummet. With Washington in chaos, we need sober heads in Columbia to address our state's most pressing needs, and that doesn't include a big annual tax cut. State leaders have to be the adults in the room.
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
25-03-2025
- Business
- Yahoo
Republicans' ‘historic' tax-cut plan attempts to give SC competitive edge
House Ways and Means Chairman Bruce Bannister, R-Greenville, (at the podium) outlines the GOP income tax plan on Tuesday, March 25, 2025, surrounded by House and Senate Republicans. (Photo by Travis Bell/STATEHOUSE CAROLINA/Special to the SC Daily Gazette) COLUMBIA — An income tax plan touted by state GOP leaders Tuesday as making South Carolina more competitive will cut taxes across all wages while requiring some people to pay more. The proposal released with much fanfare in the Statehouse lobby would collapse all tax brackets to a single, flat 3.99% starting Jan. 1 for tax year 2026 — meaning taxpayers may not really realize it until they file their taxes in spring 2027. That would seem to be a huge cut from this year's top tax rate of 6.2%, and that's the goal. Republicans have long complained the state's top marginal rate makes South Carolina appear as the highest-taxed state in the Southeast, even while the effective rate — what tax filers actually pay — was among the lowest. A 2022 law that has already reduced revenue by $1 billion has so far reduced that top tax bracket — what previous GOP leaders likened to a sticker price on a car that's negotiated down — from 7% to 6.2%. But that number is still the region's highest. The plan announced Tuesday appears to be a far deeper cut. Yet, it reduces revenue flowing into state coffers far less. Under the phased-in 2022 law, the biggest cut came in the first year, when it eliminated more than $700 million from state coffers for a half-point reduction. Under the new plan, the state can get to 3.99% in one fell swoop by shaving $200 million from tax collections, said House Ways and Means Chairman Bruce Bannister. Regionally, only Florida and Tenneessee would have a lower income tax rate — and that's because theirs is zero. Their tax structure doesn't include a state income tax. Both neighboring Georgia and North Carolina already have a flat tax rate, at 5.39% and 4.25% respectively, according to the nonpartisan Tax Foundation. 'That makes us not only more competitive, but also more attractive to new businesses and more affordable for families to call South Carolina home,' Bannister, R-Greenville, told reporters. The plan does that by adjusting the tax structure, which will result in some people paying more. Currently, South Carolina is among just five states basing tax collections on 'federal taxable income,' meaning the state taxes only what's left after home mortgage interest, property taxes and various other deductions and personal exemptions are subtracted. Essentially, tax filers start their state tax forms with less income to tax, compared to their neighbors across the state border. The plan untethers South Carolina from the federal tax code and switches to taxing adjusted gross income as most states do. That makes South Carolina's taxes truly comparable. How many taxpayers will pay more versus less is not yet known. The state's fiscal experts are working on projections that likely won't be ready until next week. Republicans call it flat and fair. '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. As of calendar year 2023, 44% of tax filers paid zero in state income taxes, while 10% of filers accounted for 65% of the total income taxes paid, according to the last analysis by the state Revenue and Fiscal Affairs Office. That was largely unchanged from before the 2022 law, which helps explain why it received unanimous approval in the Legislature. Rather than cutting taxes mainly for top earners, as the bill's filers initially proposed, the compromise spread tax breaks to lower income levels — which received high praise from Democrat lawmakers as helping the 'working man.' In its first year, the law dropped South Carolinians' average effective tax rate from 3.4% to 2.7%. With the annual income tax reductions since, the effective rate is almost certainly something less in 2025, though how much less is unknown. An updated number may be released with Fiscal Affairs' analysis of the GOP plan. The changes won't simply shift to lower-income filers. The plan provides a new personal exemption meant to help them, offering a full tax break for people drawing just $6,000 and providing relief for people making up to $40,000. The bill does not change any of the state's existing tax benefits or deductions, including those benefiting military families, senior citizens and parents of young children, Bannister said. It's also designed to start putting more money in South Carolinians' paychecks starting in 2026, by requiring the state Department of Revenue to adjust employers' withholding tables to reflect the new tax structure. That means employers will withhold less in taxes, resulting in higher take-home pay. But it should also result in smaller refunds at spring tax time, Bannister said. Democrats are withholding judgment on the new plan until they see the details. Rep. Roger Kirby, the House's assistant minority leader, said he's not opposed to a tax cut, but legislators need to be sure they don't hurt low-income residents and government services in the process. 'Those were always the unanswered questions' on various study committees over the years looking at reducing taxes, said the Lake City Democrat said. Moving to a single tax rate could reduce the sticker shock for people looking to move to South Carolina and businesses wanting to start shop here, since the top tax rate made it appear so much higher than surrounding states, Kirby said. 'Hopefully, it'll be something good everybody can support, and it'll be good for economic development,' he said. The state Chamber of Commerce, which has pushed for a tax overhaul for years, wasted no time in applauding the proposal. 'South Carolina's incredible economic growth has been achieved despite a clear competitive disadvantage — an archaic and confusing individual income tax rate that discourages investment and stymies talent attraction,' said the chamber's CEO, Mike Brenan. 'This historic tax cut proposal would fix that — immediately vaulting South Carolina ahead of other states that have recently cut tax rates and creating a more competitive economy that will attract even more jobs with even higher wages.' The proposal calls to continue reducing taxes until the flat rate gets to 2.49%. Doing that all at once would cost a whopping $2.7 billion, Bannister said. Instead, the plan calls for reducing revenues by $200 million for every year tax revenue projections rise by 5%. That might take half a dozen years of annual reductions, as the population and industry investments continue to grow. The proposal sets no time frame, Bannister said. 'Four years, five years, six years from now, if that's how long it takes us to get to that 2.49 number — it will just be different, because our economy would be different and the budget would be different,' Bannister said. McMaster called on legislators to get the bill to his desk this year. About 50 Republicans joined GOP leaders from both chambers at Tuesday's announcement, signaling widespread support. The bill will mostly likely get finalized with the state budget package for the fiscal year starting July 1. 'We'll make time,' Senate Finance Chairman Harvey Peeler, R-Gaffney, told reporters.
