A Senate subcommittee tasked to review and reform the South Carolina tax code learned that sales taxes are eroding with a shift from goods to services, and South Carolina falls well behind the national average and neighboring states on sales tax collections on Tuesday, Dec. 4.

The findings were from a presentation titled “A Road Map for Tax Reform,” co-sponsored by the State Revenue and Fiscal Affairs Office and the South Carolina Chamber of Commerce Foundation, and it examines the state’s population, tax structure, general fund and sources of revenue.

The Senate Finance Taxation System Review and Reform Subcommittee was formed by Senate Finance Chairman Hugh Leatherman (R-Florence) and is co-chaired by Senator Sean Bennett (R-Dorchester) and Senator Vincent Sheheen (D-Kershaw).

The intention of “A Road Map for Tax Reform” is to help policymakers identify ways to make the state’s tax code more competitive by identifying what the state does well along with opportunities for improvement.

Jared Walczak, a Senior Policy Analyst with the Center for State Tax Policy at the Tax Foundation, led the presentation, and he noted that South Carolina is ranked 35th nationally for a well-structured, neutral tax code.

The road map includes four options that range from very aggressive to least aggressive. Option involves expanding the sales tax base by eliminating some tax exemptions as well as taxing some services.

A summary and introduction to “A Road Map for Tax Reform” can be found at https://taxfoundation.org/south-carolina-tax-reform/.

The entire 129-page report can be found in this PDF.


The Subcommittee plans to meet again in early 2019 and the Chairman noted they expect to hear presentations from other interested groups moving forward. The Subcommittee plans to review the work of previous tax study committees as well.

Other members of the subcommittee are Senator Glen Reese (D-Spartanburg), Senator Tom Davis (R-Beaufort), Senator John Scott (D-Richland), Senator Greg Gregory (R-Lancaster) and Senator Tom Corbin (R-Greenville).

Walczak later gave his presentation to interested members of the House of Representatives.