MYRTLE BEACH, S.C. – South Carolina State Senator Greg Hembree pre-filed a bill that would reduce the number of tax brackets in South Carolina and adjust them based on a person’s adjusted gross income.
Senator Hembree said, under the bill, tax brackets would be condensed from five to three and South Carolinians would be taxed at three, five, and seven percent.
“In South Carolina, folks pay the highest rate of seven percent at an adjusted gross income of $14,500 per year,” the Senator said. “That’s such a small amount that it really does impose the highest rate on the middle class and the working poor.”
He said the brackets would be adjusted as follows:
3% for South Carolinians making an adjusted gross income between $5,000 – $10,000
5% for South Carolinians making an adjusted gross income between $10,000 – $30,000
7% for South Carolinians making an adjusted gross income of $30,000 +
Senator Hembree said this bill would save some taxpayers money.
“In essence that would give, on average, a $600 a year tax cut to anybody making under that so the working, poor, the middle class would get a $600 a year tax cut,” Senator Hembree said. “Folks that are above that, they would continue to pay that same higher rate so the wealthier South Carolinians, it would not give much of a break to, but to the folks that are kind of struggling along it would be a significant tax cut.”
He said the current tax rates have been in place for years and thinks this bill is long overdue.
“Obviously when the highest rate kicks in at $14,500 a year it’s been a long time since we looked at adjusting that rate and for whatever reason we just haven’t done it,” he said. “It’s silly to set the highest rate on folks making such small amount of money that’s [the bill’s] just been crying out for attention.”
Senator Hembree said the bill is meant to help struggling families in the state.
“It would be a tax cut of about 600 dollars a year so, the way I see it, to some folks that’s not a lot of money, but for most folks it is,” he said. “South Carolinians are working folks and a lot of us live paycheck to paycheck and to a single mom that’s raising a couple of children, that’s an extra paycheck a year,” he continued, “That’s money to buy a new set of tires on a car or maybe go on a little vacation or to get back-to-school supplies and clothes for the kids. It’s important in somebody’s day-to-day life and 600 dollars is a good bit of money.”
The Senator said the bill isn’t geared toward economic development, but said there are rating systems that would show South Carolina’s tax structure to have a lower tax rate which would be considered more competitive than other states.
“Although I think it might have some effect to make us more competitive,” Senator Hembree said. “That’s really not the goal, the goal is to help working men and women in South Carolina, working families and working poor, to put a little more money in their pocket.”