Tag Archives: South Carolina

ILN Today Post

South Carolina: Governor presents new budget, emphasizes income tax cut plan

Earlier this month, Gov. Henry McMaster unveiled his 2018-19 executive budget. In his announcement, he touted the plan as “a balanced budget that prioritizes taxpayer savings in the form of an income tax cut that, in its first five years of implementation, will result in $2.2 billion of taxpayer savings. All while investing in important areas of need such as public safety, workforce readiness, K-12 education, and access to healthcare.”

Recurring items in the general fund of about $8 billion are these:

  • $ 270.5 million: Revenue growth for fiscal year 2018-19 less General Revenue Fund (GRF), Capital Reserve Fund (CRF) & Tax Relief Trust Fund
  • $ 117.4 million: Excess debt service

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South Carolina: Residents advised to start saving gas and vehicle maintenance receipts

On July 1, 2017, a number of states’ gas tax increases took effect, including:

  • Indiana: 9.9 cents per gallon
  • Montana: 4.5 cents per gallon
  • Tennessee: 4 cents per gallon
  • West Virginia: 3.5 cents per gallon
  • South Carolina: 2 cents per gallon
  • California: 1.9 cents per gallon
  • Maryland: .3 cents per gallon
  • New Jersey: 10.8 per gallon for diesel fuel only

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South Carolina: Department of Revenue’s injunction asks the court to require Amazon to pay up

At the end of August, we posted an article addressing the tax dispute between the South Carolina Department of Revenue (DOR) and Amazon Services, LLC, an affiliate of Amazon.com, Inc. In June, the DOR sent a letter to Amazon alerting the internet retailer that it owed the state $12.5 million in unpaid sales and use taxes, plus penalties and interest, for its sales through third party vendors.

Fast forward a few months, and the DOR has filed a motion for injunctive relief, asking the Administrative Law Court to “require Amazon to collect taxes owed on all of its South Carolina retail sales (including sales of third-party owned items)-the same taxes owed by every retailer that makes retail sales in South Carolina.” The Nov. 8, 2017 motion concedes that Amazon pays some of its tax obligations, but not those on sales of “third party owned items.”

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South Carolina: DIRECTV denied request for $8.5M refund

In an opinion issued on Aug. 30, 2017, the South Carolina Court of Appeals affirmed the Administrative Law Court’s (ALC) denial of DIRECTV and its subsidiaries’ (DIRECTV) claims for an $8.5 million refund. The amount is the sum of $6,646,168 in tax and license fees; $653,425 in interest; and $1,246,155.75 in penalties relating to the companies’ 2009, 2010, and 2011 income tax returns. The case turned on the scope of DIRECTV’s income producing activities in South Carolina, namely the delivery of the signal, from which subscribers receive national and local programming, into South Carolina homes and businesses and onto customers’ television sets.

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South Carolina: South Carolina Policy Council assesses new 2017-18 budget

Governor Henry McMaster signed South Carolina’s Fiscal Year 2017-2018 Appropriations Bill, H. 3720 into law earlier this month, while also vetoing 41 provisions. In a piece titled The State Budget: What You’re Spending in 2017, the South Carolina Policy Council (SCPC) disparaged not only the $27.42 billion budget itself, for being outsized and containing “[w]aste, bad policy, etc.,” but also the process leading up to it, as indiscernible and secretive. The SCPC, founded in 1986, is a think tank whose purpose is “to publish research and analysis showing the relevance of the American republic’s founding principles: limited government, free enterprise, and individual liberty and responsibility.”

The SCPC’s main criticism is that South Carolina’s government is “outpacing the economy – by a lot.” It observes that the 2017-18 budget is the largest in history, and $1.1 billion bigger than last year’s $26.3 billion budget.

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South Carolina: Lawmakers override veto and pass a gas tax increase

As promised, the South Carolina legislature overrode Gov. Henry McMaster’s veto and passed H3516, the Infrastructure and Economic Development Reform Act, 32 to 12. Thus, effective on July 1, 2017, and then annually on July 1 until 2022, motorists will be subject to a new gas tax of 2 cents per year, for a total of 12 cents by 2022. All of the revenue is to be separated from the general fund, and deposited into either the State Highway Fund, the State Non-Federal Aid Highway Fund, or the Infrastructure Maintenance Trust Fund. The current rate is 16.75 cents per gallon, which puts the Palmetto state’s gas tax at the second lowest, behind only Alaska, whose state gas tax is 12.25 cents.

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South Carolina: Gas tax increase measure still in play despite disagreements

We recently addressed the increasing possibility that South Carolina would pass a gas tax increase this year, by way of House Bill 3516, formally known as the Infrastructure and Economic Development Reform Act (Act). House members approved it 97 to 18, and it moved to the Senate, where that chamber received it favorably. In mid-March, the measure proceeded to the Finance Committee, but a late March vote of 23 to 18 revealed less widespread support. In early April, the Senate’s debate on the bill was put on hold.
Despite support in the House, there have been suggestions that the Palmetto State may not see a gas tax increase any time soon. The Post and Courier blamed this on “[a] faction of rebellious Senate Republicans [who] killed an effort by members of their own party that would have made the highway gas tax bill a priority.” The dissenting senators took issue with the fact that the increase, which ultimately would have amounted to 12 cents, or 2 cents per year for each year between July 1, 2017, and July 1, 2022, was not offset by either tax cuts elsewhere, or reform of the highway department. The paper characterized the move as a “revolt.”
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South Carolina: Support for a gas tax increase the rise

According to the American Petroleum Institute, the national average gas tax as of its January 1, 2017 quarterly update is 49.44 cents per gallon. This consists of the following:
  • State excise taxes: 21.3 cents
  • Other state taxes: 10.01 cents
  • Federal excise taxes: 18.40 cents
South Carolina’s gas tax is less than that, at 35.15 cents per gallon, because the Palmetto State’s portion is so much lower than the national average:
  • State excise taxes: 16.00 cents
  • Other state taxes: 0.75 cents
  • Federal excise taxes: 18.40 cents

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Antitrust Enforcement Agencies Issue Joint Statement Encouraging Repeal of Virginia’s CON Program

M. Brian Hall, IV

Daniel C. Fundakowski

On October 26, 2015, the Federal Trade Commission (“FTC”) and the Antitrust Division of the U.S. Department of Justice (“DOJ”) (collectively the “Agencies”) issued a joint statement to the Virginia Certificate of Public Need (“COPN”) Work Group encouraging the Work Group and the Virginia General Assembly to repeal or restrict the state’s certificate of need process.  The Virginia COPN Work Group was tasked by the Virginia General Assembly to review the current COPN process and recommend any changes that should be made to it.

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