South Carolina Gov. Henry McMaster announced tax cut proposals for veterans, law enforcement, and first responders Jan. 5.
In the 2018-19 executive budget, McMaster said he will propose a tax reform that permanently and fully exempts military veterans and retired first responders, including state and federal law enforcement, firefighters, and peace officers, from paying state taxes on retirement income.
“This is will be about a $22 million tax cut for the men and women who put their lives on the line for us,” McMaster said.
“There’s no way we will ever be able to repay these men and women in uniform for the true value they add to our state and our community, but this is one example of how we can show our gratitude and appreciation for their service. This income tax exemption on retirement pay will reaffirm the unwavering commitment of South Carolinians to these people who have chosen to serve.”
Scored by the South Carolina Revenue and Fiscal Affairs Office (RFA), the governor’s proposed exemption for South Carolina’s 37,863 military veterans is an augmentation of Act 272 of 2016 and will result in average yearly savings of $524 for military retirees under the age of 65 and $210 for those 65 and older. In total, the exemption for military veterans will result in a tax cut of over $14 million in fiscal year 2018-19.
The governor’s exemption for South Carolina’s 20,370 law enforcement officers, firefighters and peace officers was similarly scored by the RFA and is expected to result in an $8.5 million yearly tax cut – an average of $713 yearly savings for a retiree under the age of 65 and $102 for those 65 and older.
The proposal would have to be approved by the General Assembly.