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SC Lawmaker Targets Business Licensing Scam

Palmetto State taxpayers and business have been getting ripped off for years … now one legislator is demanding answers.

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Two years ago this website reported exclusively on a massive fleecing of South Carolina citizens and businesses via “hidden taxes” paid on their business licenses and insurance premiums.

Unfortunately, the state’s mainstream media failed to pick up the story … and nothing has been done about it.

Until recently …

First, a quick recap: As we reported back in October 2015, for decades the Municipal Association of South Carolina (MASC) has been collecting a fee on all city business licenses and on various insurance policy premiums issued in the Palmetto State.

According to internal MASC data (.pdf) collected – but not published – at the time of our original report, this “hidden tax” has deprived South Carolinians of at least $1.6 billion from 2001-2014.

Over the same time period, the organization has collected more than $47 million in fees related to its collection of the tax.

A similar scam is run at the county level by the S.C. Department of Insurance (SCDOI), which is part of the cabinet of governor Henry McMaster.

Two months ago, state representative Kirkman Finlay submitted a letter to MASC requesting updated information on its collection of these hidden taxes.  Specifically, Finlay requested dates and results of recent MASC audits, specific fee structures imposed by the organization in collecting this money and information on whether MASC was earning and retaining interest on the proceeds of these funds.

Here’s a copy of Finlay’s letter …

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We’re supposed to get updated, detailed data on this ongoing fleecing within the next few weeks – information we look forward to passing along to our readers.

In the meantime, we see no reason why any uniform tax or fee assessed in the state of South Carolina should be processed anywhere other than the S.C. Department of Revenue (SCDOR).

That’s what the agency is there for, right?  To collect taxes and fees?

Unlike other bureaucracies, SCDOR has no agenda … it exists for the sole purpose of collecting money and transferring it into the appropriate accounts.

Any other arrangement strikes us as improper and inefficient … not to mention an open invitation for fraud and corruption.

From where we sit, this is yet another example of the people of the Palmetto State getting nickeled and dimed by big government.  A little here, a little there … but the end result is always the same, hundreds of millions of dollars that should be staying in our economy getting vacuumed up and re-routed into the pockets of select special interests.

Is this approach working for our citizens?  Hell no …

Anyway, stay tuned … we should have more data and detail on this fleecing very soon.

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