Research Areas
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 April 4 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 2009, South Carolina taxpayers had to work until April 4 to pay their total tax bill, ranking 38th highest in the nation. That's nine days earlier than national Tax Freedom Day (April 13). The Tax Freedom Days of neighboring states are: North Carolina, April 9 (ranked 25th) and Georgia, April 12 (ranked 17th).
Full study of Tax Freedom Day, nationwide and in each state
South Carolina's State/Local Tax Burden Below National Average
Estimated at 8.8% of income, South Carolina's state/local tax burden percentage ranks 37th highest nationally, below the national average of 9.7%. South Carolina taxpayers pay $3,127 per capita in state and local taxes.
South Carolina's State and Local Tax Burden, 1977-Present
Other States' State/Local Tax Burdens
Historical Chart Comparing All States' State/Local Tax Burdens from 1977 to 2008
South Carolina's 2009 Business Tax Climate Ranks 25th
South Carolina ranks 25th 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 ranked as follows: Georgia (27th) and North Carolina (39th).
50-State Comparison of Business Tax Climates (data only)
2009 State Business Tax Climate Index, Sixth 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 $13,150. Among states levying personal income taxes, South Carolina's top rate of 7.0% is 12th highest nationally. In 2006, state individual income tax collections were $635 per person, which ranked 35th 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 41st highest nationally. In 2007, state-level corporate tax collections (excluding local taxes) were $71 per capita and ranked 45th 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 Levies Sales Tax above National Median; Lowest Cigarette Taxes in the Nation
South Carolina levies a 6% sales tax on transactions, which is above the national median of 5.4 percent. State and local governments combined collected $765 per capita in general sales taxes in 2006, which ranks 36th 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 and Excise Tax Rates
50-State Table of State and Local General Sales and Gross Receipts Tax Collections Per Household and Per Capita, Fiscal Year 2005
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
