Paul Hyde of Greenvilleonline.com has a very interesting article he titled “S.C.’s dirty little tax secret” in which he writes:
Our state and local tax burden is relatively modest.
You, of course, are not supposed to know this.
Many state and local politicians get elected — again and again — by trying to make you believe taxes are crushingly burdensome in South Carolina.
Politicians, with swords drawn and tongues forked, sail into office pledging to slay the tax dragon.
But, it turns out, this dragon is a lizard.
The only thing that gets slain is the truth.
The truth is this: South Carolina ranks 37th in the nation in the state and local tax burden — with 1 being the highest and 50th the lowest.
Mr. Hyde also notes that
New Jersey residents, meanwhile, pay 11.8 percent of per capita income. New Yorkers are close behind, paying 11.7 percent, and Connecticut is third at 11.1 percent.
Why am I befuddled at a comparison between state taxes in South Carolina and those in New Jersey, New York and Connecticut, all of which are among the nations highest in cost of living? In fact, these three states are 46th, 47th and 48th (in reverse rankings) and fall only to the District of Columbia, California and Hawaii as THE highest.
Mr. Hyde goes on to point out several short comings in South Carolina with which I can’t argue, though I don’t understand how highway deaths and DUI’s relate to taxes.
Mr. Hyde means well [Why, then, was his article “Does Sanford Hate Public Education” taken off line?], so I guess he just forgot to mention that South Carolina actually rates 28th in total state taxes, according to the Census Bureau.
Just over 38% of the state’s population is either 18 years and younger or over 65,
South Carolina ranks 44th in per capita income (40th in median household income) and near the top – 10th – with persons below the poverty level (15.6%).
And, of course, we have some differences about education spending. [Wasn't there an increase in the Department of Education budget of something like a quarter of a billion dollars from 2006-07 to 2007-08? If I'm reading that wrong, please advise.]
My point with all this arithmetic is that South Carolina certainly doesn’t have the base to raise taxes. But that isn’t what Paul Hyde recommended. He just doesn’t want to see them cut. Fair enough.
There needs to be better stewardship of state funds. Until there is, talking about cutting or raising taxes is silly.
Great post. Clearly the more refined details of tax policy are lost on Mr. Hyde. As you note, there are two ways to think about the tax burdens:
Compared directly to other states with the same average personal income (KY, AR, ID, MT, NM) South Carolina is the seconded highest.
Or compared to all our neighborhoods in the Southeast, with adjustment for personal income, South Carolina is still above the mean.
Also, if you look at the numbers gathered by the Tax Foundation, NASBO, or even the B&CB you see that South Carolina has a huge revenue dependence on so-called “non-tax” income like fees, permits, etc that don’t even get factored into these 50 state comparisons.