An S.C. House committee combined an income-tax cut proposal Thursday with a plan to raise money to fix the state’s crumbling roads, giving South Carolina three road-repair plans. The House plan could emerge as the “just right” porridge as lawmakers try to stir up a road deal.
Another plan – Gov. Nikki Haley’s tax-swap proposal – is too hot, legislators say, adding the state can’t afford the income-tax cut that the Republican governor wants. The third plan – the Senate’s – is too cold, without enough support to survive a Haley veto.
That leaves the House proposal as possibly the middle ground.
The three proposals have been offered as solutions to the $1.5 billion-a-year shortfall in the money needed to maintain, repair and expand the state’s road, bridge and mass transit system, according to the state Transportation Department. Just to pay for maintenance and preservation of the state’s existing roads and bridges would require an extra $1billion a year.
The House plan, sponsored by state Rep. Gary Simrill, R-Rock Hill, would raise roughly $427million a year.
That plan would increase the state gas tax by the equivalent of 10 cents a gallon and the state’s maximum sales tax on vehicles to $500 from $300. After Thursday’s action by the House Ways and Means Committee, the House proposal now also includes an income-tax cut that would save the average taxpayer $48 a year.
That’s far less than the tax cut that Haley has said she wants in return for supporting a roads deal. But legislators and others say Haley’s proposed tax cut would wreck the state’s general fund budget.