Last Updated on February 12, 2022
If South Carolina gubernatorial candidate Nikki Haley gets her way, there’ll be some major changes made to taxes in this state.
Specifically, she wants to eliminate income taxes on businesses, thereby having the working class folk take on the tax burden solo.
Haley has received big name endorsements from Sarah Palin and Jenny Sanford (our current ex-First Lady).  I know that Republicans like to portray themselves as being all about tax cuts, but does this really fit into that?  We’re in a recession, and her plan would cost the state an additional $260 million dollars that it is currently collecting from corporate income taxes.
What’s a few million here and there, right?
Well, consider South Carolina’s already-dire situation, in which it has already:
– Eliminating a program that helps seniors pay for prescription drug costs not covered by Medicare part D.
– Reducing funding for programs that serve people who have disabilities or are elderly.
– Cutting state education grants to school districts and education programs, along with higher education operating funding and financial aid.
– The South Carolina Department of Juvenile Justice has lost almost one-fourth of its state funding, resulting in over 260 layoffs and the closing of five group homes, two dormitories, and 25 after-school programs.
Somehow, I don’t think this is the time to cut taxes. I’m not advocating that we raise them, although there are proposals out there to do that as well.  And the problem with this whole “it’ll attract new jobs” argument, (other than the valid argument that it really doesn’t work to begin with) is that those new jobs won’t be here immediately.  New jobs from new industries that decide to move to the Palmetto State take time to appear.
So what happens in the meantime?  What happens to state programs between the time those businesses get off the hook from paying taxes and the time someone else starts hiring people who’ll carry the tax burden alone?
And what happens to more of those critical programs that are next on the chopping block?  And can she guarantee that lawmakers won’t find a way to increase our taxes to make up the difference of this money that she’s suddenly so willing to part with?
Didn’t think so.
The grocery tax used to be 5% just 5 years ago… I don't think she wants to raise it that high, though I could be wrong…
I think this follows the Republicans' health-care reform doctrine, which boils down to little more than cutting Medicare and the taxes which fund it. I thought all the talk about "death panels" was ironic coming from the party which has always been about cutting social programs.
In my native country the first group of people to lose social benefits whenever taxes are cut are the geriatrics. Feels like home to see that it's the same on this side of the pond. Ironically, unless things have changed, retirees and the elderly in general have traditionally been very active voters – more active than people in their 20's anyway – and yet they keep voting in people who will cut their programs. Go figure.
The old Republican fallacy is that if you cut taxes from big corporations, they will use those savings to hire more Eddie Punchclocks. Which, after they're done paying bonuses to their board members, they do. Just not in America, but in Bombay.
Here's the thing…..business don't pay taxes. It don't [sic] happen! They pass them on to the end consumer in the form of higher prices. So cutting taxes for businesses would more than likely end in lower prices for those consumers which obviously would have a trickle down effect. If I need to explain that, you should probably just stop reading right now.
Second, although it is a nice thought for seniors or others who are disabled to have assistance paying for prescription drugs or services, that is not free either. Guess who pays for those….that's right, you; the same one who doesn't think that we should be should shoulder the burden for businesses believes that we SHOULD shoulder the burden for that portion of the population. So pick your poison.
As far as money for education grants and the funding for educational programs, why not look at the administration-level jobs where you have the bureaucrats of those systems making >$200k. That is wasted money in its purest form. So cut the salary on those people and many of those programs would survive on money already in that system.
The long and short of it is if there is no money to pay for something in my house we just have to go without it. I'm not able to go to my boss and tell him my salary isn't accommodating my lifestyle and I WILL be taking a raise. Learn to do with what you have already been given.
Finally, cutting taxes is nothing more than letting those who actually EARN their money KEEP more of it to spend on what THEY want to spend it on; not what bureaucrats and the ever-growing government machine wants to spend it on. The thought that government knows how to spend my money better than I do is ridiculous. Case in point: Greece. Or if you prefer something a little closer to home look at California where the government is currently issuing "I owe you's" to its employees because it promised a Panacea of government services that it can't even begin to cover.
The government is not here to "do" for you. It's called personal responsibility folks. Learn about it.
So cutting taxes for businesses would more than likely end in lower prices for those consumers which obviously would have a trickle down effect.
Carl, let's say you owned a business that sells a product for $50 per unit. With the tax gone, you determine that you can sell this product for $42.50 and make the exact same profit.
So you are left with a choice: you can drop the price and earn the same money you've been making, or leave the price alone (or drop it only slightly) and make MORE money and NOT pass the savings on to the customer.
How many businesses do you really believe aren't going to try to pad their pockets here, thereby invaliding the whole "trickle-down" thing?
Really, I get your point, and in a perfect world, I agree with it 100%. But corporate greed doesn't allow for trickle-downs. Corporate greed says, "Great! More money for us until we absolutely HAVE to drop the prices."
This looks like trickle down and my argument FOR would be that if the businesses aren't paying the taxes, then they can hire/expand, so more people would be working, and the tax base would grow. Cutting taxes on individuals would save them money, but it wouldn't have the added benefit of adding jobs. In her scenario best-case, more folks would have jobs to pay taxes from, almost a win-win all around.
Problem is that people are greedy and not as prone to spend their own money if they don't have to. Good in theory, I think trickle down was a bust in the 80s and became the voodoo economics of the 90s. If we're all benevolent, it might work out – but we're not, so some balance of that with ways to save taxpaying public citizens as well would be the best in my limited view. 🙂