Index Places South Carolina 31st On Business Tax Environment List | Caroline from the south
(The Center Square) – South Carolina is ranked 31st among the best states for the tax environment for business, according to the Fiscal Foundation 2022 business climate index.
The state was helped the most by its fifth-best corporate tax ranking, but ranked low for personal income taxes (33rd), sales taxes (31st), property taxes (36th). ) and unemployment insurance taxes (27th).
“The clue (from the Tax Foundation) is, quite frankly, cold water in the face every time it comes out,” said Oran Smith, senior researcher at the Palmetto Promise Institute. “But we think the basis of the Statehouse is changing.
“North Carolina cutting its corporate tax to 0% and its personal rate to 3.99% was a huge wake-up call there. With us at 7% and North Carolina at 3.99%, it’s hard to argue that the “effective” or “real” rate is the same in every Carolina. It will no longer calculate. Two tax reduction projects introduced in the [South Carolina] The Senate which seemed “symbolic” in November seems very real in January. “
The bills – Art. 924 and S. 925 – introduced on December 7. The first was dubbed the South Carolina Jobs and Competitiveness Act of 2022 and would see state income tax equal 3.5% of the difference between federal taxable income and state standard deduction.
The second is dubbed the “South Carolina Fiscal Policy Modernization Act” and relates to sales, income and property taxes. It states that “tax policy changes must be implemented comprehensively, simultaneously and rapidly to promote current and future economic growth, including private sector capital investment and job creation; to correct disparities in the tax burden and favoritism towards special interest groups; and to promote significantly lower taxes. on a broader basis. “
The Tax Foundation is a nonprofit tax policy group that has been operating since 1937.
Its annual index aims to assess how each state structures its overall tax system and proposes policies to improve this structure.
The index classifies states into five broad tax categories and provides an overall ranking.
Wyoming, South Dakota, Alaska, Florida, and Montana led the Tax Foundation’s rankings while New Jersey, New York, California and Connecticut were the lowest ranked states.
Caroline from the south announcement in early November that it would lower or maintain the current unemployment tax rate for all businesses in the state.
South Carolina lawmakers have decided to use federal COVID-19 relief funds to keep the fund intact. The trust fund had a balance of $ 1.1 billion before the pandemic and a balance of $ 1.19 billion in early November.
The fund was reduced to $ 350 million at one point, but $ 500 million in federal relief funds was sent to the fund to help businesses avoid a significant increase in unemployment taxes.
“While other states have had to take out millions of dollars in loans to cover the cost of unemployment, South Carolina has taken a fiscally responsible approach that now pays dividends in the form of reduced taxes for our businesses and employees. no debt to repay, ”Governor Henry McMaster said. when the unemployment tax rates for 2022 were announced.