I've been reading the past few days about the "tax relief" plans being pitched by our governor and House Republicans. I can't quite bring myself to get on board, so I'm looking for some perspective. In many ways, both plans are pretty much the same. While they would both make some nominal effort to help all S.C. residents, the main thrust seems to be to reduce the tax burden for businesses.
Both would eliminate the corporate income tax in stages over the next four years and cut property taxes for manufacturers. The House Republican plan would also reduce property taxes for commercial and rental properties and allow small businesses to report less income. Neither plan makes any effort to replace this state revenue from some other income stream.
The governor says the logic is obvious. "I'm always amazed by the people that say, 'If you cut, where is the money going to come from?'" Haley told the Charleston City Paper. "If you ask these guys, any of the business people, if we cut taxes, they will increase revenues, they will hire more people, and you will turn the economy."
What do you think? If you ask businesses to pay less in taxes, will they hire more people and pay their current workers more? Or will they simply pocket the difference and report better profits? And is cutting taxes without a plan to replace the income a good policy? I have no doubt that lowering corporate tax rates of all sorts will be good for businesses. My question is, is the idea good for the many more people in the state who are employees, not employers? I don't own a business. I just work at one. Why should I support this idea?