News
Property tax law could face review
March 2, 2010
Property tax law could face review
By Rudolph Bell
South Carolina representatives have thrown a
political hot potato to state senators, inviting new
debate on tax changes loved by homeowners but
hated by business interests.
House members have agreed to let a special
commission reviewing tax policy take up the
controversial Act 388 as part of its work. Now the
resolution goes to the Senate, where it's expected to
face opposition.
Lawmakers created the South Carolina Taxation
Realignment Commission last year and gave it
authority to recommend any change to tax policy
except the property tax relief given to homeowners
in 2006 through Act 388.
That law, passed to placate homeowners upset over
rising property taxes, exempted owner-occupied
homes from taxes related to public school
operations and capped property tax reassessments
at 15 percent over five years.
It also raised the sales tax by 1 percent to 6
percent, as a way to make up revenue lost by the p
roperty tax relief, and removed the sales tax from
groceries.
Act 388 has come under fire from businesses and
others who say they have been left holding the bag
for future increases in the cost of running public
schools. The South Carolina Chamber of Commerce
is calling for its repeal.
The resolution adopted by the House authorizes the
commission to review “all constitutional and
statutory provisions pertinent to the imposition of ad valorem taxes.”
It also extends the commission's
deadline for making recommendations to lawmakers
from March 15 to Nov. 15.
Sen. Larry Martin, Pickens Republican, said he isn't
among senators opposed to letting the commission
review Act 388.
“I think the entire tax structure should be evaluated
by this commission,” Martin said. “I don't know how
you can take part of it off the table and insist the
rest of it be reviewed in isolation.”
Rep. Harry Cato, Travelers Rest Republican, said the
commission should be allowed to examine Act 388,
but he is against putting school operations taxes
back on owner-occupied homes. “Whatever we do I don't
want us to back up on property tax relief for the homeowner,”
Cato said.
