Baaaaad News For SC Revenue

Battered by a bad economy and a state government hellbent on spending every last dime of taxpayer money it can get its grubby paws on, it should come as no surprise that South Carolina’s economy is “reeling from the feeling.”

At least that’s what May tax collection data is telling us, as individual income, corporate and sales taxes are all limping along

Here’s the bleak report from S.C. Comptroller General Richard Eckstrom’s office:

“Individual income tax receipts showed the largest declines. They were 48.4% ($175 million) lower for May 2009 than for May 2008. This followed a 38.9% ($129 million) decline for April 2009 over April 2008. On a fiscal year-to-date basis (July through May), individual income tax receipts are 16.1% ($476 million) below the prior year.

“Corporate income tax receipts were down 40.7% for May, following a decline of 35.4% for April, resulting in a year-to-date decline of 17.3 % ($44 million).

Sales and use tax collections fell 15.7% ($33 million) last month and 8.7% ($177 million) so far this year.

“Revenues from all sources fell 35.5% ($226 million) in May following declines of 24.5% ($149 million) in April. Through May 2009, total revenues have plunged 12.8% ($756 million) for the year.

Nice.

With record unemployment, declining tourism revenues, the Southeast’s highest marginal income tax rate and a legislative branch that can’t restrain itself from growing government even in the worst economic environment on record, the fact that South Carolina’s tax revenues are in the crapper shouldn’t come as a surprise to anybody.

“This extraordinary situation forcefully underscores the need for spending caps, lower debt, and higher reserves to better cushion us during times like these,” Eckstrom said.

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