Trikki Nikki Haley’s “Tax Cuts”
GOVERNOR’S “TAX TOUR” MUCH ADO ABOUT NOTHING
S.C. Gov. Nikki Haley approved more than $1 billion worth of new spending in last year’s record-breaking state budget. Meanwhile her executive budget for the coming fiscal year proposed spending nearly $1 billion more in new money.
And this is supposed to be a “Tea Party” governor?
Seriously … what happened to “limited government?”
Nonetheless the big-spending Haley – who we never thought would reduce herself to banking on the ignorance of the mainstream media – is embarking on a statewide tour this week in support “tax cuts.” And no, we’re not talking about the ridiculous grocery tax-corporate tax “swap” she proposed in 2010 (a mild tax increase that she thankfully abandoned after assuming office last year). We’re referring to Haley’s current plan – which would tinker with South Carolina’s low-income tax brackets while preserving our state’s punitively-high 7 percent marginal rate on all income above $14,000.
For those of you unfamiliar with our state’s ridiculously anti-competitive income tax code, anyone making minimum wage in South Carolina (i.e. $15,000 a year) is already paying the state’s top marginal rate of 7 percent.
Take a look …
Income Range/ SC Tax Bracket
$0 – $2,739 = no state income tax
$2,740 – $5,479 = 3 percent
$5,480 – $8,219 = 4 percent
$8,220 – $10,959 = 5 percent
$10,960 – $13,699 = 6 percent
$13,700 and higher = 7 percent
As we’ve noted on numerous previous occasions, “whether you’re flipping burgers or flipping properties, you’re paying the state’s top marginal rate.”
Haley’s plan would “flatten” these lower rates – but it does nothing to lower the 7 percent top marginal rate, which must come down if we ever expect our state’s moribund economy to start firing on any (let alone all) cylinders.
All told, Haley’s tax plan would provide an estimated $80-$100 of annual “relief” to the typical family of four in the Palmetto State. And while we don’t necessarily have a problem with that (any dollar not spent on government is A-OK in our book), we don’t expect this pittance to provide any real boost to our state’s consumer economy.
Nor do we expect it to provide any real relief for the tens of thousands of small businesses (and sole proprietors) in South Carolina who pay the individual income tax.
“She wants a talking point not tax reform,” one state lawmaker said of Haley’s plan.
We agree. Haley’s plan will provide one member of one family an extra item on the McDonald’s value meal every fourth day of the year.
“It’s a great day in South Carolina, right?”
In contrast to Haley’s anemic proposal, this website has proposed taking every penny of surplus revenue for the coming fiscal year (again, close to $1 billion at last count) and applying it to individual income tax relief. Seriously … Haley and “Republican” legislators are spending at least $1.3 billion on government growth this year … why can’t next year’s budget give that surplus back to the people who provided it?
Does Haley really think government knows better than the private sector how those funds should be invested?
In addition to its paucity of relief, Haley’s plan also has a potentially serious process problem working against it, too.
Tax legislation – like any other change to state law – must be introduced and passed as a stand-alone bill (assuming you want for this “relief” to remain in place for more than one year). It can’t be passed as a budget proviso – and even if it could, Haley has previously railed on provisos for their lack of transparency.
Amazingly, even though she is half-way through her second legislative session, Haley has not only failed to instruct her Department of Revenue to draft such legislation, she has failed to find anyone in the S.C. General Assembly to introduce it for her.
That’s beyond lazy …
Seriously … this governor has found the time to write a book, sip wine with California bloggers, tweet incorrect information about the music she’s listening to in the office and make up stories about her daughter winning beauty pageants … but she hasn’t found time to call loyal allies like S.C. Rep. Nathan Ballentine or S.C. Sen. Greg Ryberg and get them to sponsor her tax bills?
South Carolina needs real tax relief … not more “reform in name only.”
Unfortunately, as was the case with the government restructuring issue, Haley appears incapable of providing the leadership necessary to achieve real, lasting reforms that will have a measurable impact on taxpayers’ bottom lines.
Of course that’s not stopping her from pretending.