The Palmetto Insider

The blog of the South Carolina Policy Council

Why Not Just Cut Taxes? – A Quick Take on H 4478

with one comment

In a bill full of twists and turns, one of the more salient points to come out of H 4478 is the presumption that state-driven economic development is a fait accompli – and, under the current legislative leadership, that may very well be the case. Of particular note are amendments to: the tax code, in particular regarding job tax credits; as well as changes to the Enterprise Zone Act (EZA) of 1995 and the Economic Impact Zone Community Development Act of 1995.

Changes to the latter are particularly important in that they broaden applicable investment tax credits to include all qualifying manufacturing and productive equipment property – as opposed to just investments in communities affected by military base closures (§ 17-18).

In short, H 4478 would make the entire state an economic development zone.

The alternative, of course, is to make the entire state a free-market development zone, as detailed in Unleashing Capitalism. In other words, instead of continuing to pick winners and losers through tax credits and other such incentives, why not just lower taxes? In particular, the Legislature should cut the state’s highest-in-the-nation effective manufacturing property tax of 3.73 percent.

Members of the House Ways & Means committee will be discussing the bill tomorrow at 9 am.

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Written by Jameson Taylor

February 3, 2010 at 4:43 pm

One Response

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  1. Law Makers hate tax cuts, they cannot brag on what they gave their buddies. Most politicians are not
    business people. If they ran a business , their idea to make a profit would be raise prices higher than their competition. Politicians believe higher taxes
    produce more revenue, the fact is less taxes produce more business which produce more revenue at a lower rate of taxation . SC lawmakers are ill equipped to
    run any business must less the state`s business. Let`s
    vote them out.

    jet

    February 4, 2010 at 9:17 pm


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