Comprehensive Tax Reform Passes Senate

Since the legislative session began back in January, I talked with many of you who thought it was time to take a serious look at the state's tax system. I have been working on a bill that would review the entire tax code of South Carolina to make recommendations to overhaul the system, in order to bring about strong economic growth. And after much debate, the Tax Realignment Commission (TRAC) plan passed the Senate earlier this afternoon.

During these very tough economic times, problems continue to rock the nation. South Carolina continues to be hit especially hard as we now have the third highest unemployment rate in the nation at 9.5 percent. Many are blaming South Carolina's antiquated and piecemealed tax structure as the primary cause of our state's woes. Called "loophole-riddled" and a "special-interest driven tax system" by The State newspaper, the tax code is an obstruction to economic growth in South Carolina.

The plan, which I introduced in the Senate, is modeled after the federal BRACC program. In an attempt to overhaul the tax code while removing the political pressures from the process, an independent commission of financial and economic experts will be created to assess the effectiveness of the current tax system structure and to provide recommendations for changes to the General Assembly. This plan will alleviate the concerns of politics dictating tax policy.

I am very pleased with the passage of the TRAC legislation today by the Senate. I thank the members of the Senate for a healthy debate and for passage of the bill. I believe that the creation of this commission is the best way for South Carolina to re-vamp our outdated tax laws. We must take a serious look at how our tax code works and this commission will be the most effective way for us to do that, as we seek to achieve fairness, equity and efficiency in our tax code.

Once again, if I can ever be of any assistance to you, please do not hesitate to contact me.


Sen. Hugh K. Leatherman
South Carolina Senator
District 31, Florence and Darlington Counties