South Carolina

The Facts on South Carolina's Tax Climate

Here are some basic facts on South Carolina's tax system and how it compares to other states:

Tax Freedom Day Arrives on March 29 in South Carolina
Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2011, South Carolina taxpayers work until March 29 to pay their total tax bill, ranking 48th highest in the nation. That's 14 days earlier than national Tax Freedom Day (April 12). The Tax Freedom Days of neighboring states are: North Carolina, April 6 (ranked 27th) and Georgia, April 3 (ranked 37th).
Full study of Tax Freedom Day, nationwide and in each state.

South Carolina's State and Local Tax Burden Below National Average
South Carolina's state and local tax burden is currently estimated at 8.1% of income (43rd nationally), below the national average of 9.8%. Compared to the 1977 data, South Carolina had a tax burden of 9.0% (38th nationally), decreasing 0.9% overall. Currently South Carolina taxpayers pay $2,742 per capita in state and local taxes.
South Carolina's State and Local Tax Burden, 1977-Present
Other States' State/Local Tax Burdens
Map of U.S. Showing all State's Burdens and Ranks
Historical Chart Comparing All States' State/Local Tax Burdens from 1977 to 2009 

South Carolina's 2012 Business Tax Climate Ranks 36th
South Carolina ranks 36th in the Tax Foundation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property. Neighboring states rank as follows: Georgia (34th) and North Carolina (44th).
50-State Comparison of Business Tax Climates (data only)
2012 State Business Tax Climate Index, Ninth Edition (full study)

South Carolina's Individual Income Tax System
South Carolina's personal income tax system features six income brackets with a top rate of 7% kicking in at a relatively low income level of $13,700. Among states levying personal income taxes, South Carolina's top rate of 7.0% is 13th highest nationally. In 2008, state state-level individual income tax collections were $748 per person, which ranked 34th highest nationally.
50-State Table of Individual Income Tax Rates
50-State Table of State Individual Income Tax Collections
50-State Table of State and Local Individual Income Tax Collections Per Capita

South Carolina's Corporate Income Tax System
South Carolina's corporate tax structure consists of a flat tax of 5.0% on all corporate income. Among states levying corporate income taxes, South Carolina's tax ranks the state 40th highest nationally. In 2008, state-level corporate tax collections (excluding local taxes) were $72 per capita and ranked 44th highest nationally..
50-State Table of Corporate Income Tax Rates, 2000-2009
50-State Table of State and Local Corporate Income Tax Collections Per Capita and Per Household, 2005
50-State Table of State Corporate Income Tax Collections Per Capita, 2006

South Carolina Sales and Excise Taxes
South Carolina levies a 6% sales tax on transactions, which is slightly above the national median of 5.85%. In 2007 combined state and local general and selective sales tax collections were $1,110 per person, which ranks 44th highest nationally. South Carolina's gasoline tax stands at 16.8 cents per gallon and ranks 46th highest nationally. South Carolina's cigarette tax stands at 7 cents per pack of twenty and is the lowest in the nation. The sales tax was adopted in 1951, the gasoline tax in 1922 and the cigarette tax in 1923.
50-state table of sales, cigarette, gas, beer, wine, and spirits tax rates
50-State Table of State and Local General and Selective Sales Tax Collections Per Capita

South Carolina Property Taxes: Comparatively Modest
South Carolina is one of the 37 states that collect property taxes at both the state and local levels. As in most states, local governments collect far more. South Carolina's localities collected $920.25 per capita in property taxes in fiscal year 2006, which is the latest year the Census Bureau published state-by-state property tax collections. At the state level, South Carolina collected $2.28 per capita during FY 2006, making its combined state/local property taxes $922.54, which ranks 34th highest nationally.
State property tax collections per capita by state

Federal Tax Burdens and Expenditures: South Carolina is a Beneficiary State
South Carolina taxpayers receive more federal funding per dollar of federal taxes paid than the average state. Per dollar of federal tax collected in 2005, South Carolina citizens received approximately $1.35 in the way of federal spending. This ranks the state 16th highest nationally and represents a slight rise from 1995, when South Carolina received $1.20 per dollar of taxes in federal spending, ranking it 18th highest nationally. Neighboring states and the amount of federal spending per dollar of federal taxes collected were: North Carolina ($1.08) and Georgia ($1.01).
Comparing the amount of federal taxes sent to Washington with the amount of federal spending coming back to the state

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