South Carolina sales tax
The South Carolina Supreme Court has maintained the state’s current sales tax exemptions, at least for now. This May, it threw out a lawsuit challenging billions of dollars worth of exemptions. The court threw out the lawsuit on a technicality however and didn’t weigh in on the validity of the case. This means another challenge on the same grounds is possible.
The party challenging the exemptions sued claiming the exemption structure placed an excessive burden on the poor. He challenged that the limits are too low so their relative impact unduly affects poorer taxpayers. For example, South Carolina sales tax is caped at $300 for cars, boats, and airplanes. This means someone buying an old, used car often pays the same amount in sales tax as someone buying a luxury car or airplane.
The Supreme Court justices threw out this case because they deemed the plaintiff couldn’t prove he was suffering under the current tax structure; the plaintiff’s children were not yet in school so they were not yet affected by a lack of tax revenues. As a result, the plaintiff didn’t have a right to initiate a lawsuit. Chief Justice Jean Toal made it clear though that this ruling would not prevent another challenge on the same grounds.
Currently, South Carolina exempts more in sales taxes that it actually collects. Both Republican and Democratic lawmakers have argued the state needs to review exemptions. However, no changes have yet been enacted or are under consideration by the legislature.
Read more from the Associated PressCharles F.
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