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HOT ISSUE
A
Noah's Ark approach to tax reform
By Andy Brack
S.C. Statehouse Report
AUG. 4, 2002 - - The big hoopla this week in Columbia was the first
meeting of a special new S.C. House committee that's looking at
tax reform.
Well, it's an election year, so go figure.
Seriously, House Speaker David Wilkins empanelled the committee
to develop a comprehensive, fair, stable and equitable approach
for reforming the state's taxing structure.
The 15-member panel, stacked with twice as many Republicans as
Democrats, will look at the big picture to explore ways to reduce
or eliminate taxes. They'll look for alternative sources of revenue
and ways to use the tax structure to improve education and economic
development.
A cynic might translate the previous paragraph as: "They're
looking to cut some taxes, raise other taxes and see if they can
do anything to help businesses grow."
But Wilkins told members their work, which is due early next year,
could have a dramatic effect.
"I'm asking you to come up with new ideas - - workable solutions
- - to improve our state tax structure," he said Wednesday.
Interestingly, the work of the House ad hoc committee is mirrored
by the new Joint Committee on Taxation, which House and Senate members
agreed to form in the recent legislative session. Its mission is
to develop a report by 2006 that reviews the state's revenue laws,
analyzes ways to make a more workable tax system, provides advice
for changes to the basic tax structure, suggests alternative revenue
sources and develops long-term revenue recommendations.
Sound familiar? Like Noah and his animals, things in South Carolina
seem to come in twos…or maybe threes.
Back in 1999, the Legislature authorized a different committee
to study the local government funding system. That committee spawned
an academic effort at the University of South Carolina called the
Local Government Research Project. Guess what it's planning to publish
in November? A comprehensive book on state and local sources of
revenue.
S.C. Rep. Bill Cotty (R-Columbia) says the new House committee's
work will provide a more sweeping view for lawmakers next year as
they struggle with various revenue proposals, from increasing cigarette
and gas taxes to revamping the way the state spends health care
dollars.
"We're looking at [whether]we should be making short-term
decisions that have any long-term impacts," he said. "We
shouldn't," which is why the study will be helpful, he added.
Results from this year's committee work also will provide information
that will help the joint tax study committee as it develops a longer-term
strategy, he said.
More than anything, what's really going on with all of these committees
is our state's political leaders are trying to get ahead of the
curve on how the state brings in money to pay for government services.
With two more years of bad budget times expected because of the
economic downturn and slow recovery, there's going to be a lot of
pain in the offing unless lawmakers find new ways of doing things.
Regardless of political agendas that may creep into the work of
these two committees, their work is vitally important. Taxpayers
want to make sure their investment in government is worth it. They
want services to be delivered efficiently and effectively.
While no one wants to pay more taxes, delivery of needed services
- the main thing most taxpayers want from government - can't be
done without revenues. Lawmakers should remember that cuts in revenues
generally mean cuts in services. And that's something many people
don't necessarily want.
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