SC

Eliminate SC Newspaper Exemption

S.C. LAWMAKERS SHOULD CLOSE $13 MILLION LOOPHOLE, PUT MONEY IN REBATE FUND Earlier this month, this website delved into allegations that The (Charleston, S.C.) Post and Courier – the largest newspaper in the Palmetto State – was bullied into backing off of a major scandal involving powerful S.C. House Speaker Bobby…

S.C. LAWMAKERS SHOULD CLOSE $13 MILLION LOOPHOLE, PUT MONEY IN REBATE FUND

Earlier this month, this website delved into allegations that The (Charleston, S.C.) Post and Courier – the largest newspaper in the Palmetto State – was bullied into backing off of a major scandal involving powerful S.C. House Speaker Bobby Harrell.

(For the latest on Harrell’s ongoing saga, click here).

Why would the paper have done such a thing?

Well, one of the central components of our story was the allegation that The Post and Courier – whose former publisher spent countless hours in Columbia, S.C. lobbying lawmakers on behalf of an industry tax exemption – decided to “play ball” when legislative leaders threatened to close this tax loophole.

For those of you keeping score at home, South Carolina has dozens of sales tax loopholes – many of which are targeted to specific special interests.  In fact the state actually exempts more than it collects in state sales tax.

In the case of the newspaper industry, publishers are exempt from paying the state’s six percent sales tax on the paper they purchase to print – and the papers they sell to readers.  That translates into $13 million annually – money which goes straight into their pockets.

Obviously this website is not about to propose eliminating this tax break and putting that $13 million into the grubby paws of state government.  What are we endorsing?  Eliminating this tax break and putting the money into a “taxpayer rebate fund” like the one championed for the last two years by S.C. Sen. Tom Davis (R-Beaufort).

If South Carolina had a fund like this, our lawmakers could quickly and easily send surplus revenues, so-called “savings” and money from closing these loopholes directly to the taxpayers.

Doing so would not only make our tax code more competitive, it would slow the growth of government and put more money in people’s pockets.

Needless to say our state’s “Republican-controlled” S.C. General Assembly – which likes to boast about how “conservative” its leaders are – doesn’t want to do that.  In addition to growing government by leaps and bounds and preserving an anti-competitive tax climate, it is painfully obvious that these “conservatives” enjoy lording such special interest exemptions over the heads of their loyal subjects (most of whom fill their coffers every year with special interest campaign contributions).

Meanwhile … for the rest of us the beat goes on (bada boom da doom dada).

Since our report was published earlier this month The Post and Courier has – to its credit – resumed its reporting on the Harrell scandal (although its latest installment failed to follow up on several key components of his dubious self-reimbursements).

More on that later, though …

For now, lawmakers need to close this loophole and send this $13 million back to the taxpayers.  Then they need to start from the very top of the list of sales tax exemptions and start determining whether each one of them should be rebated as well.

But the newspaper exemption must be the first one to go … if for no other reason than it represents nothing more than an annual bribe to the state’s mainstream media (an infinitely corrupt arrangement that in our opinion materially contributes to South Carolina being one of the most corrupt states in America).

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16 comments

Joe October 23, 2012 at 3:40 pm

Eliminate all the sales tax exemptions and reduce the sale tax rate. What even happen to the lawsuit brought against SC for having more in sale tax exemptions than in sale tax collections?

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south mauldin October 23, 2012 at 4:34 pm

It is still ongoing.

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Wink 'n Nod October 23, 2012 at 3:45 pm

Objection! This would cut into Pierre’s weekend-boogie spending money.

Overruled. Harrell will reimburse Pierre from his GOP reptile fund.

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sweepin October 23, 2012 at 3:54 pm

Which taxpayers? To those that contribute to the tax coffers via income taxes? Or to those who pay sales taxes.

Joe’s suggestion is best; simply lower the sales tax collection when the exemptions are removed.

Sales taxes are a sorry and unpredictable source of revenue to begin with. Gov’t can’t fund recurring basic costs of government effectively as we learned the hard way during the most recent and enduring downturn.

Secondly, sales taxes are regressive as hell. They place the load on those who are poorest and those on fixed income (Seniors, retirees, disabled, etc.)

Rebate sales tax income to those who pay only income tax? How then, would the payers of the sales tax be rebated? This rebate crap is so old and impractical as to be laughable. Even stubborn mules know when a dead horse has been beaten long enough.

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south mauldin October 23, 2012 at 4:35 pm

Agred. What happens when the state budget is $30 milion in the hole? Does each taxpayer have to pay his or her fair share.

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Raspy October 23, 2012 at 4:04 pm

Not a bad idea. How about putting The State newspaper’s rescinded tax breaks into that precious bus system they don’t believe Midlands tax payers can ever dump enough good money after bad, into?

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ohnonotagain October 23, 2012 at 4:26 pm

Will, this is asinine.
The “exemption” on the purchase of newspapers won’t go back to the taxpayers.
If the exemption goes away, the price of newspapers increase. So the taxpayers will pay more.
And it will be the ONLY disseminator of public information that is taxed on its delivery, giving a slightly unfair advantage to TV, radio and web sites that are not paid content.
Just face up to that one fact. If the exemption on sales tax for newspaper goes away, readers start paying a tax they didn’t before. In other words, it’s a tax INCREASE.

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Bonhoeffer October 23, 2012 at 4:49 pm

FITS is way ahead of you here. If the exemption is removed, newspaper publishers will just pass that cost on to consumers in the form of higher costs per newspaper. If newspapers cost more, people will buy less of them, but they still want to get thir news from somewhere (particularly state and local). So what happens, they go online and click on blogs like this one…which equals to more profit for FITS.

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Original Good Old Boy October 23, 2012 at 5:42 pm

The taxpayers who choose to buy a newspaper will pay more, as it should be. Those taxpayers who sensibly read their news on the Internet should not subsidize those who still receive their morning paper.

In any event, if the newspaper must pay more, and the readers will support the price increase, so be it. But if the readers won’t support the price increase, then the government shouldn’t prop up a dying business.

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same ol' same ol' October 23, 2012 at 4:26 pm

Are there any examples of a govt that is run this way? If so, what are the results? The logistics of it all seem to be screwed up.

Not that I’d turn down a rebate check, but seems it would be better to manage your money, then reduce taxes if there was a surplus.

Alas, if there was a surplus, instead of thinking about the future, our esteemed leaders would look at it as a gift and how they could spend it.

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they call me Mr. Sinister October 23, 2012 at 4:39 pm

How about we eliminate the sales tax cap on autos? The max one will currently pay is $300 regardless of the sales price. Assuming just a 2% sales tax on a $50,000 car would be $1000. Want another sales tax loophole. Did you know there are no sales tax on Bibles? One last did you know…there are no sales taxes assessed or collected on grocies paid for with an EBT card? Seriously, if a person can not afford to pay $2 on a free $100 groceries then something is really wrong.

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9" October 23, 2012 at 4:52 pm

‘I remember the newspapers dying like huge moths.No one wanted them back. No one missed them.’

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? October 23, 2012 at 5:30 pm

A supposed *libertarian* calling for taxes….this is just great.

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Thomas October 23, 2012 at 5:33 pm

I see you are a Libertarian who will call for more taxes…when it benefits you.

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BigT October 23, 2012 at 5:52 pm

For a “Fiscal Conservative” FITS has never met a tax break he likes…

I don’t care if you are a Liberal-Libertarian, or moderate,…but we have far too many LIARS in the media…

Just admit what you are…

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Jeffy01 October 24, 2012 at 8:25 am

So had they not fired Renee….and printed the story that you and Ashlee drafted for them…..you would be ok with their tax exemption.
Hi pot let me introduce you to my good friend kettle

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