- Associated Press - Tuesday, May 1, 2018

COLUMBIA, S.C. (AP) - Gov. Henry McMaster on Monday urged legislative leaders to bring South Carolina’s tax code in line with federal provisions, saying he’d sign a bill that includes tax relief for all South Carolinians.

“Failure to conform our state income tax code before the end of this year will create confusion, frustration and chaos when South Carolinians attempt to file their taxes next year,” the Republican wrote in a letter to Senate President Pro Tem Hugh Leatherman and House Speaker Jay Lucas, the State newspaper reports .

State leaders worry President Donald Trump’s tax reform overhaul could leave residents paying more in state income taxes if legislators simply tie South Carolina’s tax code to the federal changes, as it routinely does, without also cutting state taxes. A study found South Carolina taxpayers will pay $1.6 billion less in federal income taxes as a result of the new federal law, but $180 million more in state income taxes if the state aligns with the new IRS rules.

A tax-conformity bill filed in March by House Ways and Means Committee chairman Brian White is still at the committee stage. McMaster has said he’d only sign such a bill if it includes tax cuts for all South Carolinians.

Before lawmakers can tweak the state’s tax code, they first must pass a bill giving accountants and online tax services time to conform state tax documents to the new federal code.

Time is running out, with only six legislative days remaining in this year’s regular session. McMaster suggested lawmakers could address tax conformity when they return to Columbia this summer to take up vetoes and finish other business.

One of the Republicans mounting a primary challenge to McMaster this year demanded conformity more than a month ago. In March, former state public health chief Catherine Templeton issued a statement saying that failing to bring South Carolina’s code in line with federal changes would leave state lawmakers with more than $200 million annually “instead of allowing us to keep it in our pockets and do with it as we see fit.”

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Information from: The State, http://www.thestate.com


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