[South Carolina]… legislators seem convinced that there are only three things they can do about taxes: Raise them, slash them, or ignore the issue. But there’s a fourth option, and it works and is desperately needed whether they ultimately raise taxes, lower them or leave them just where they are: Fix them.
Our tax code was built on the tried-and-true “three-legged stool” formulation, deriving roughly equal revenue from the sales, income and property taxes. But that balance has become skewed, as we rely far too heavily on the sales tax, making our tax system much too volatile. And there are significant problems within each major tax ”” as well as with the minor taxes ”” that create gross inequities and prevent revenue growth from keeping pace with economic growth.
The most obvious, smack-you-in-the-face problem is our 85 sales tax exemptions, which result in more goods being untaxed than taxed and are the target of a lawsuit pending in the state Supreme Court. And the grossest example of bad exemption policy is the $300 tax cap on automobiles, which means people who buy clunkers pay the same tax as those who buy luxury cars ”” and boats and planes.
The premise that because other states do something, we in South Carolina should do the same is pretty typical of The State’s lefty editorial stance. Hey, let’s be like New Jersey, Michigan and California! For those of you who are not in SC the sales tax exemption on cars sounds bad; but we pay astromomical property taxes on vehicles. Actually what South Carolina needs is a constitutional convention. Our current constitution was written to promote aparthied and keep the governor from from having any power to stop Jim Crowe laws. It really has no relevance in 2011.