A South Carolina income tax cut and rebate bill agreement is on its way to the desk of Governor Henry McMaster after acceptance from the conference committee. It was unanimously passed by both the state’s House and Senate- this comes after they passed competing acts at the end of the 2022 legislative season.
Anyone who paid taxes this year in the amount of $800 or less will receive a 100% refund check, which applies to over 30% of the state’s taxpayers. The checks will be issued in late November or December of this year.
The rebate amount will depend on income tax liability. Those who paid $100 in taxes will be fully compensated with a $100 rebate. The rebate will be eligible for tax liability growth with a maximum amount of $800 for each filing. People who did not pay for South Carolina income tax this year are not eligible for any tax rebate.
South Carolina’s currently has six tax brackets at 0%, 3%, 4%, 5%, 6%, and 7%. This legislation would drop three of the brackets, with only 0%, 3% and 6% remaining. It would also decrease the statewide top tax rate for income taxes in 2023 to 6.5% from the current 7%. We could expect for the top tax rate to have an annual rate decrease of 0.1% until it drops to 6%.
In the first year alone, the act would have a $600 million outcome and that number would eventually rise to an impact of $1 billion. It also entails a 33% decrease in manufacturing property taxes- 6% from the 9% rate, adding up to $100 million in savings statewide for manufacturers.
To read more about the upcoming changes from this bill, click here.